PSBank eyes P15 billion from LTNCDs

MANILA, Philippines — Listed Philippine Savings Bank (PSBank) is raising as much as P15 billion through the issuance of long-term negotiable certificates of time deposits (LTNCDs) as it beefs up its consumer banking business.

PSBank president Jose Vicente Alde said in a disclosure to the Philippine Stock Exchange (PSE) the bank’s board of directors approved the fund raising activity last Monday.

“The issuance of LTNCTDs will give PSBank an opportunity to access long-term funding as the bank further expands its consumer banking business,” Alde said.

He said the LTNCDs with a tenor of 5.5 years would be issued on two or more tranches over a one-year period.

Alde said the final terms of the fund raising activity, including the offering period and interest rate, would depend on market conditions.

Likewise, he said the LTNCD offering would have to be approved by the Bangko Sentral ng Pilipinas (BSP).

LTNCDs have been an effective way for banks to raise cost-effective funding, while offering a new investment product to their own deposit base, most of whom are looking for long term assets that provide higher yields than traditional time deposits.

PSBank last issued LTNCDs worth P3.375 billion in January 2017. It launched a P10-billion LTNCD offering in September 2016.

PSBank earnings jumped 25 percent to P641.1 million in the first quarter from P511.1 million in the same quarter last year.

Alde had traced the improvement from the year-on-year momentum brought about by the bank’s strategy to focus on exceptional customer experience, digitization of products and channels as well as automation of backroom processes.

“These resulted in an expansion of our market stronghold and good bottom line performance,” Alde said.

The country’s second largest thrift bank in terms of assets posted a double-digit growth of 15 percent in total operating income to P3.7 billion from P3.2 billion.

PSBank’s loan portfolio grew by 11.7 percent to P149.2 billion, driven by the bank’s consumer loan business.

The listed bank’s total assets rose by 9.4 percent to P224.8 billion as its deposit base went up by 9.2 percent to P186 billion.

PSBank currently has 250 branches and 611 ATMs strategically located nationwide.