Bank of Commerce launches peso bond offering

MANILA, Philippines — San Miguel-led Bank of Commerce (BankCom) has started the public offer of its dual-tranche fixed rate bonds, aiming to raise at least P5 billion with an oversubscription option.

In a disclosure to the local bourse, BankCom said the offering marks the third tranche under the bank’s expanded P50 billion peso bond program.

The bond issuance includes Series C Bonds due 2027 and Series D Bonds due 2030. The Series C Bonds have a tenor of two years and a fixed interest rate of 6.1942 percent per annum.

Meanwhile, the Series D Bonds have a tenor 5.25 years and will offer a fixed interest rate of 6.3494 percent per annum. Both bonds will pay interest quarterly, with a minimum investment amount set at P100,000, followed by increments of P50,000.

Eligible individual investors who hold the Series D Bonds until maturity will benefit from a net fixed interest rate of 6.3494 percent annually.

The public offering will run from Jan. 28 to Jan. 30, closing at 12:00 noon. The bonds are set to be issued and listed on the Philippine Dealing & Exchange Corp. (PDEx) in Feb. 19.

“Proceeds from the issuance will be used for management of the bank’s balance sheet, diversification of funding sources, and general corporate purposes,” BankCom said.

BankCom appointed ING Bank N.V., Manila Branch, Philippine Commercial Capital Inc. (PCCI Capital), Security Bank Capital Investment Corp. and Standard Chartered Bank (SCB) as joint lead arrangers and joint bookrunners for the issuance.

BankCom is also acting as a selling agent for the offering, together with ING, PCCI Capital, Security Bank Capital and SCB.

BankCom’s financial performance has shown steady growth. As of September 2024, the bank reported a net income of P2.2 billion, a 10-percent increase from P2 billion in the same period in 2003.

The bank’s return on equity stood at 9.27 percent as of September last year, significantly higher than the 4.22 percent ROE projected in its initial public offering (IPO) prospectus. BankCom attributed its robust profitability to growth in its core lending business, with net interest income rising 11 percent year-on-year.

Bank of Commerce earlier raised P6.57 billion in its second foray into the domestic debt market in May 2024, higher than the original size of P5 billion.

In its first foray into the domestic debt market, BankCom raised P7.5 billion in July 2022, more than double the original size of P3 billion, due to overwhelming demand.