Zobel-led Bank of the Philippine Islands is planning to raise at least P5 billion from an offering and issuance of Peso-denominated fixed-rate ASEAN Sustainable Bonds due 2026, with an option to upsize.
In a disclosure to the Philippine Stock Exchange, the bank said the planned issuance will be the third tranche of its P100 billion Bond Program approved by its Board of Directors on May 18, 2022.
The net proceeds of the Offer will be used for the financing or refinancing of new or existing Eligible Green and/or Social Projects as defined under, and consistent with, BPI’s Sustainable Funding Framework.
The Sustainable Bonds, which will have a tenor of one and one-half (1.5) years, will be offered at a minimum investment amount of P500,000, and in additional increments of P100,000.
The Offer period will start on July 18, 2024 and end on August 2, 2024. The Sustainable Bonds are expected to be issued and listed with the Philippine Dealing and Exchange Corporation on August 9, 2024.
BPI Capital Corporation and Standard Chartered Bank are the Joint Lead Arrangers and Selling Agents of the Offer.
The Joint Lead Arrangers and Selling Agents reserve the right to update the Offer terms and the periods and dates prescribed above, as deemed appropriate and with due notice.
In March this year, BPI raised $400 million by successfully tapping the international capital markets with a public US-dollar bond issuance for the first time since 2019.
The bank said its offering of 5-year Reg S senior unsecured notes were issued under BPI’s $3 billion Medium Term Notes Programme.
BPI said the Notes are rated Baa2 by Moody’s and the net proceeds will be used for refinancing and general corporate purposes.
The 5-year Notes were priced at U.S. Treasury spread of T+105 basis points (bps) with a coupon of 5.25 percent, representing the tightest ever spread on a 5-year bond from a non-sovereign Philippine issuer, adding another milestone to BPI’s long list of achievements.
BPI had announced the transaction mandate on March 18, 2024 and conducted a comprehensive investor marketing exercise involving a global investor call and a series of meetings covering investors across Hong Kong, Singapore, and London.
After receiving positive investor feedback, BPI said it proceeded to launch the transaction bookbuilding on March 19, 2024, with an Initial Pricing Guidance of T+140 bps area.
“Orderbooks saw strong momentum throughout the day, despite a week rife with global central bank policy meetings, with the final books standing at over $1.3 billion, as the Notes were 3.3 times oversubscribed,” the bank said.
It noted that, “This allowed 35 bps of pricing compression from IPG to final pricing, even as the issue size was increased from the original indications of $300 million, to accommodate the strong oversubscription levels.”
In terms of geographic allocation, the Notes were distributed 81 percent to Asia and 19 percent to EMEA and Offshore U.S. accounts.
The Notes were distributed to high quality fixed income accounts: 51 percent to Fund Managers, 29 percent to Banks, 17 percent to Private Banks and Financial Institutions, and 3 percent to Insurance.
BPI Capital was the Sole Global Coordinator, while J.P. Morgan, Mizuho, Standard Chartered Bank and UBS were the Joint Lead Managers for the transaction.