PSBank raising P40 billion via multi-tranche bonds

MANILA, Philippines — Philippine Savings Bank (PSBank) is raising as much as P40 billion via the issuance of peso-denominated bonds as part of efforts to further expand its consumer banking business.

PSBank president Jose Vicente Alde said the board of directors of the consumer banking arm of Ty-led Metropolitan Bank & Trust Co. (Metrobank)  approved the planned bond issuance in multiple tranches last Tuesday.

“The issuance of the bond is part of the bank’s funding program. This will also give the bank an opportunity to access long-term funding as it further expands its consumer banking business. This will also diversify the bank’s funding base and tap a wider investor base targeting both institutional and individual investors,” Alde said.

He said the offering period, interest rate and tenor of the bond would depend on market conditions. The debt instrument will be listed in the Philippine Dealing and Exchange Corp. (PDEX).

Likewise, he said the country’s second largest thrift bank in terms of assets also raised its authorized capital stock to P6 billion from P4.25 billion to provide PSBank more flexibility for any potential business opportunities in the future that would need sufficient authorized and unissued shares that can be issued promptly.

PSBank raised P8 billion via the sale of shares to existing shareholders last January to further solidify its capital adequacy and financial strength.

The proceeds from the fund raising activity will be used to strengthen the bank’s common equity Tier 1 (CET1) capital and support the bank’s expected asset growth primarily on consumer loans.

PSBank lined up several fund raising activities to further boost its consumer banking business.

It has announced plans to issue medium-term fixed or floating rate notes worth as much as P10 billion to access medium-term and stable funding as it further expands its consumer banking segment.

PSBank has also launched a P20 billion long-term negotiable certificates of time deposits program where it has so far raised P5.1 billion last August.