Security Bank Corporation has successfully raised P20 billion from the issuance of its Fixed Rate Peso Corporate Bonds due 2029— four times the original amount and its largest issue size so far.
In a disclosure to the Philippine Stock Exchange, the bank said bonds carry a rate of 6.05 percent per annum with a tenor of five years and one month.
Due to strong demand for the bonds, the bank exercised its oversubscription option and accepted offers above its minimum P5 billion issue size. The Bank also ended its bond offer period early as volume significantly exceeded the target.
The bonds were listed at the Philippine Dealing & Exchange Corporation (PDEx) on Aug. 20, 2024.
Security Bank said it offered the bonds to diversify its funding sources and support its lending activities.
"We’re humbled by the overwhelming response to our bond offering, which reflects the strong trust and confidence of our investors in Security Bank and our BetterBanking promise.
“We’re grateful for their support and will strive to keep delivering value to our clients and stakeholders," said Security Bank Executive Vice President and Financial Markets Segment Head Arnold Bengco.
Security Bank has mandated Philippine Commercial Capital, Inc. (PCCI) as Sole Bookrunner; and PCCI and SB Capital Investment Corporation as Joint Lead Arrangers and Selling Agents for this issuance.
The bank’s net profit increased 11 percent to P5.4 billion in the first half of 2024, driven by accelerated growth in business drivers. Total revenues for the first half grew 24 percent year-on-year to P25.7 billion.
Net interest income increased 38 percent to P21.7 billion with net interest margin at 5.20 percent, up 96 basis points year-on-year. Service charges, fees and commissions jumped 74 percent to P4.9 billion.
Operating expense was 20 percent higher in the first half of the year, driven by investments in manpower and technology to accelerate transformation. Strong performance led to a cost-to-income ratio of 58.4 percent, lower than the 60.4 percent a year ago.
The bank set aside P3.3 billion as provisions for credit losses in the first half of 2024, an increase versus year-ago level of P1.6 billion. Gross non-performing loan ratio was 3.31 percent and NPL reserve cover was 81 percent.