PLDT borrows P5 B from Metrobank

MANILA, Philippines - Metropolitan Bank & Trust Co. (Metrobank) has extended a P5 billion loan to Philippine Long Distance Telephone Co. (PLDT).

Metrobank senior vice president Antonio Ocampo Jr. and Metrobank vice president Mylene Caparas signed the memorandum of agreement for the 10-year loan facility with PLDT chief finance officer Anabelle Chua and PLDT treasurer Leo Posadas.

PLDT intends to use the proceeds of the loan to partially bankroll its capital expenditures and at the same time refinance its existing financial obligations.

PLDT raised its 2015 capital expenditures to a record P43 billion from the original P39 billion to upgrade infrastructure for improved network and data connectivity.

PLDT chairman Manuel V. Pangilinan earlier said expenditures is likely to stay elevated until 2016 as the company intends to further improve its services.

The company is investing heavily to expand its 3G and 4G coverage, data center capacity as well as its fiber assets.

Core earnings of Metrobank jumped 30 percent to P9.3 billion in the first half on the back of double-digit growth in both loans and deposits, stronger contributions from fee based-income, and improved efficiencies with better cost management.

On the other hand, the bank’s operating expenses were flat at P19.4 billion during the period.

Metrobank ended the first half with an equity base of P189 billion, the highest in the industry, and reported total assets of P1.6 trillion.

It reported a 20.3 percent Capital Adequacy Ratio (CAR) and a 16.3 percent Common Equity Tier 1 Ratio (CET1), comfortably above the 10 percent minimum requirement of the Bangko Sentral ng Pilipinas (BSP).

Asset quality remains better than industry as non-performing loans (NPL) ratio came in at 1.2 percent from a year-ago level of 1.3 percent. The bank reported provisions for credit and impairment losses of P1.9 billion.

Metrobank president Fabian Dee earlier said the bank would use the amount to further expand its core business

“After successfully completing our capital raising program, we are poised for further expansion in our core business.  Metrobank will have the flexibility to grow strategically and manage sustainable returns despite the challenges in the domestic and global markets,“ Dee said.

Metrobank has the largest domestic network of 938 branches and over 2,100 automated teller machines (ATMs) nationwide, and 32 foreign branches, subsidiaries and representative offices.