MANILA, Philippines -- Philippine National Bank (PNB), the nation's fourth-biggest private commercial bank, said on Friday it was doubling its offer of lower Tier 2 capital subordinated debt to P6 billion ($135 million), with the interest rate fixed at 8.5 percent.

PNB did not elaborate in a brief statement to Manila's stock exchange.

On Tuesday, PNB said it was looking to offer Tier 2 notes worth P3 billion to investors to raise capital to refinance outstanding notes callable in February 2009. It said initial market response to the offer was "very strong," with over P7 billion in total orders as of June 6.

The notes will have an initial maturity of 10 years but are callable by 2013.

PNB may close the offer period on June 18 or earlier.

PNB is set to merge with Allied Banking Corp. in the third quarter through a share swap, creating the country's fourth-largest bank by assets.

Both banks are controlled by tycoon Lucio Tan, who also owns Philippine Airlines and unlisted companies such as Fortune Tobacco Corp. and Asia Brewery Inc.

Shares in PNB closed 1.6 percent higher at P32.00 on Friday.

($1 = P44.40)