Lucio Co-led Philippine Bank of Communications (PBCom) has raised P7.69 billion from its oversubscribed maiden issuance of Peso Fixed Rate Bonds.
The bank said in a disclosure to the Philippine Stock Exchange that the bonds have been listed on the Philippine Dealing & Exchange Corp. (PDEx) on November 5, 2024. It had initially planned to raise P2 billion through the bond offering.
The bonds, with a tenor of one-and-a-half years and a fixed interest rate of 6.0796 percent per annum, represent the first tranche under PBCom’s P15 billion Peso Bond Programme.
“The offering of our Peso Fixed Rate Series A Bonds due 2026 was closed more than a week ahead of schedule due to robust demand, resulting in an oversubscription of 3.85 times the initial amount,” said PBCom President and CEO Patricia May Siy.
She noted that, “This is a true sign of the market’s confidence in our efforts over the past years, which have delivered a solid track record in asset, revenue, and profit growth.”
As of June 2024, PBCOM’s total assets reached P148.7 billion, a 12.2 percent increase compared to the same period in 2023. Loans and Receivables also saw double-digit growth, reaching P90.0 billion compared to same period in 2023.
PBCOM’s capital position remains solid, with Capital Adequacy and CET 1 ratios at 16.39 percent and 14.14 percent, respectively; all above the regulatory minimum for a universal bank.
Proceeds from the Bond issuance will be utilized for general corporate purposes, including refinancing debt obligations, diversifying funding sources, and supporting loan growth.
ING Bank N.V., Manila Branch was the Sole Arranger and Bookrunner, with both PBCOM and ING acting as the selling agents.
PBCom had ended its P2 billion maiden Peso bond offering ahead of schedule, closing more than a week early due to robust investor demand.
Initially set to run from October 14 to October 28, the offering attracted strong interest from both retail clients and a diverse mix of institutional investors.
PBCom was assigned an issuer credit rating of PRS Aa minus (corp.), with a Stable Outlook, by Philippine Rating Services Corporation (PhilRatings).
An issuer credit rating, also sometimes called corporate credit ratings or company ratings or counterparty credit ratings, is a measure of a company’s over-all creditworthiness.
A company rated PRS Aa (corp.) differs from the highest rated corporates only to a small degree, and has a strong capacity to meet its financial commitments relative to that of other Philippine corporates. The “minus” further qualifies the assigned rating.
PhilRatings said PBCom’s assigned rating and Outlook took into account the bank’s enhanced growth potential following the approval of its universal banking license and its experienced management, complemented by synergies within its major shareholder’s ecosystem.
Also taken into consideration is the bank’ sustained earnings growth, but short-term profitability will be subdued; notable improvements in asset quality; and telatively modest share of low-cost current account and savings account (CASA) to total deposits.