Security Bank, PNB set LTNCD issues

MANILA, Philippines — Listed Security Bank Corp. is set to tap the debt market this month  for the issuance of P20 billion in  long-term negotiable certificates of deposit (LTNCD).

Security Bank informed the Philippine Stock Exchange (PSE) it received last Tuesday the approval of the Bangko Sentral ng Pilipinas (BSP) for the fund raising activity.  

“The issue size is up to the aggregate amount of P20 billion. For the first tranche, the offer period is targeted in October or a date to be determined depending on BSP approval and prevailing market conditions,” it said.

LTNCDs are negotiable certificates of deposit with a designated maturity, and represent a bank’s obligation to pay the face value upon maturity, with periodic coupon or interest payments during the life of the deposit.

Interest income is exempt from withholding taxes if the LTNCDs are held for at least five years.

Security Bank president and CEO Alfonso Salcedo Jr. earlier said the bank is looking at a tenor of at least five to seven years for the first tranche scheduled either this month or next month.

Salcedo said Security Bank   intends to raise between P5 and P10 billion in the first tranche.

Proceeds of the issuance, he said, would be used to fund the asset growth of the bank and lengthen the maturity profile of its liabilities.

Meanwhile, Tan-controlled Philippine National Bank (PNB) is raising at least P3 billion from the third tranche of its  LTNCD issuance that kicked off yesterday.

PNB informed the  PSE  the issue size has an option to upsize depending on the demand as the offer period started yesterday until Oct. 19.

The LTNCD due April 2023 has an indicative interest rate of 3.75 to 3.875 percent per annum, but the final rate would be determined during the offer period. The issue date is on Oct. 26.

The HongKong and Shanghai Banking Corp. Ltd. and ING Bank N.V., Manila Branch are the joint lead arrangers and bookrunners while PNB, HSBC, ING and Multinational Investment Bancorp. are the selling agents. PNB Capital and Investment Corp. is the financial advisor for the offering.

Tan-controlled Philippine National Bank (PNB) is raising at least P3 billion from the third tranche of its long-term negotiable certificates of time deposit (LTNCD) issuance that kicked off yesterday.

PNB informed the Philippine Stock Exchange (PSE) the issue size has an option to upsize depending on the demand as the offer period started yesterday until Oct. 19.

The LTNCD due April 2023 has an indicative interest rate of 3.75 to 3.875 percent per annum, but the final rate would be determined during the offer period. The issue date is on Oct. 26.

The Hongkong and Shanghai Banking Corp. Ltd and ING Bank N.V., Manila Branch are the joint lead arrangers and bookrunners while PNB, HSBC, ING and Multinational Investment Bancorp. are the selling agents. PNB Capital and Investment Corp. is the financial advisor for the offering.

LTNCD offers higher interest rates but could not be pre-terminated like regular time deposits.

Upon issuance, the LTNCD would be listed for trading through the facilities of the Philippine Dealing and Exchange Corp.

PNB receives the green light from the Bangko Sentral ng Pilipinas (BSP) to issue up to P20 billion in LTNCD in October last year.

Last April, PNB raised P3.765 billion from the second tranche of the LTNCD issuance. The country ‘s sixth largest bank also raised P5.38 billion from the first tranche of the issue last December.

Proceeds for the fund raising activity would be used to extend the maturity profile of the bank’s liabilities as part of overall liability management and to raise long-term funds for general corporate purposes.