FMIC eyes issuance of up to P10-B corporate bonds

MANILA, Philippines - First Metro Investment Corp. (FMIC), the investment arm of the Metrobank group, plans to issue up to P10 billion worth of corporate bonds in the latter part of the year or early 2013, a top company official said.

On the sidelines of the listing ceremony for a P7-billion fixed rate corporate bonds issuance, FMIC president Roberto Juanchito Dispo said that aside from revisiting the capital market for an additional listing, they are also looking at the possibility of issuing longer-tenor debt papers or with maturity of 10 years.

Lengthening the maturity of the bonds they plan to issue, the official said, would lower their funding costs and at the same time widen the tenor of their deposit base.

The FMIC executive said the planned additional bond issuance is anchored on the optimism of continued stability on the country’s overall economic fundamentals and the ability of the monetary authorities to maintain sound policy framework.

FMIC successfully listed yesterday at the Philippine Dealing and Exchange Corp. (PDex) its P7 billion fixed rate corporate bonds due Nov. 2017 and August 2019.

“First Metro spearheaded this initiative primarily as a liability management exercise in order to lengthen the company’s deposit tenor base. The company achieved its objective as the P7 billion bonds were issued in two tranches, P4 billion for the 5.25 year tenor at a rate of 5.5 percent and P3 billion for the seven-year tenor at a rate of 5.75 percent,” Dispo said.

“The First Metro bonds was very well received by the market with an oversubscription of over 40 percent, driving up demand from the original issue size of P5 billion to P7 billion,” Dispo said.

The biggest clamor, he said, came from retail investors which bought 65 percent of the bonds through the trust departments of 11 banks.

Standard Chartered Bank is the sole bookrunner and underwriter for the transaction.

FMIC’s listing on PDEx was the ninth for the year and brought the year-to-date new corporate and bank debt listings to P97.85 billion.