Security Bank to tap domestic debt market

MANILA, Philippines — Security Bank Corp. is returning to the onshore debt market to raise at least P5 billion through the issuance of two-year fixed-rate peso bonds after doubling the size of its bond and commercial paper program to P100 billion.

Raul Martin Pedro, executive vice president and treasurer at Security Bank, told The STAR proceeds of the fund raising activity would be used to extend the tenor of the bank’s liabilities and augment its lending business.

“Just trying to extend tenor of liabilities. Proceeds for usual lending operations,” Pedro said in a text message.

The bonds with a yield of 3.125 percent per annum would be issued out of Security Bank’s P100-billion peso bond and commercial paper program, double the P50-billion program established in December 2018.

Of the total amount, Security Bank has so far raised P18 billion in its maiden bond issuance in June last year.

Security Bank said it could upsize the volume and adjust the offer period originally scheduled from June 23 to July 15 depending on the demand. The listing of the bonds at the Philippine Dealing and Exchange Corp. (PDEx) was slated on July 24 to provide secondary market liquidity to investors who would like to trade the instruments.

It has mandated Philippine Commercial Capital Inc. (PCCI) as sole bookrunner, while PCCI and SB Capital Investment Corp. would serve as joint lead arrangers and selling agents for the fund raising activity.

Security Bank last tapped the domestic debt market in February, raising P2.07 billion via the issuance of long- term negotiable certificate of deposits (LTNCDs) due 2025, bringing to P24.82 billion the amount raised from LTNCDs since November 2017.

It raised P6.06 billion through the issuance of LTNCDs in September last year, followed by another P2.31 billion in December last year and P2.07 billion in February. All the debt papers issued are due in 2025.

The bank also issued P8.6 billion worth of LTNCDs in November 2017 and P5.78 billion worth of LTNCDs in May 2018. The LTNCDs are scheduled to mature in 2023.