Security Bank raises $400 M from oversubscribed notes issue

Security Bank Corporation has issued $400 million of 5.50 percent Senior Unsecured Fixed Rate Notes due May 14, 2029 as a drawdown of its Board approved $1 billion Medium Term Note Program.

In a disclosure the Philippine Stock Exchange, the bank said the transaction was announced on the back of a series of global investor calls that were held on May 6, 2024. 

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Proceeds from the Notes will be used to expand funding base, fund investments, and other general corporate purposes.

"We're very pleased about the strong demand and successful pricing of our dollar bond issuance," said Security Bank Executive Vice President and Financial Markets Segment (FMS) Head Arnold Bengco. 

He noted that, “This transaction reflects the market's continued confidence in Security Bank's credit strength and growth prospects. The issuance also diversifies our funding sources and enhances our ability to serve our clients across various segments and sectors.”

The bonds were marketed at an initial pricing guidance of US treasuries plus 140bps. Orders reached more than $1.5 billion, covering the final book size by more than 3.75 times. 

This is the largest orderbook size in the Bank’s history of debt issuances. Furthermore, the amount of interest in the notes led to a historic spread of 110bps for the Bank.

The offering generated strong interest from a diverse pool of investor accounts, consisting of global fund and asset managers, banks, insurance companies, private banks, and other institutions. The transaction is expected to settle on May 14, 2024.

The Notes will be listed on the Singapore Exchange (SGX) and are expected to have an Issue Rating of Baa2 by Moody’s.

Security Bank has mandated MUFG and UBS as Joint Global Coordinators, alongside Standard Chartered Bank and SB Capital as Joint Bookrunners for the transaction.