UCPB launches P1.85-billion long-term negotiable CDs

MANILA, Philippines - United Coconut Planters Bank (UCPB) has launched a P1.85-billion long-term negotiable certificates of time deposit (LTNCDs) as it continues its capital build-up this year.

UCPB Treasury Banking Group head Eulogio Catabran III said that the UCPB Series 3 LTNCDs are deposit products that have higher returns and longer maturities than regular time deposits.

“In 2010, we offered P3 billion in LTNCDs which was oversubscribed by some P4.5 billion. Last year, we did it again by raising P3.15 billion from the planned P3 billion. Given the high investor confidence, we knew that this latest venture would be worthwhile,” Catabran said.

Individual Filipino and corporate investors may invest a minimum of P 50,000 at a fixed interest rate of 5.875 percent per annum to be paid quarterly over the next five years and three months.

Government deposit insurer Philippine Deposit Insurance Corp. (PDIC) gives insurance coverage to LTNCDs up to P500,000 per depositor.

The public offering is ongoing until May 15 this year. Investors can purchase the LTNCDs from any of UCPB’s 188 branches or its selling agent. Interested parties may also buy from the secondary market after the offer period.  

Catabran said the proceeds of the sale will be used to increase its long-term deposit base and sustain the growth of its loan portfolio which provide higher margins and cover the bank’s maturing long-term deposits.

During the first quarter, UCPB expanded its loan portfolio to P73.6 billion from P62.1 billion from a year ago with consumer loans increasing at a faster rate. Interest income generated by the loans rose by 15 percent during the period.

Total deposits rose by nine percent to P162 billion. Net income rose by 34 percent to P883.7 million in the first quarter of the year, clearly sustaining the growth momentum it has achieved in 2011.