Metrobank offers another P8B worth of long-term debt paper

MANILA, Philippines–Local banking giant Metropolitan Bank and Trust Co. has offered a new tranche of long-term negotiable certificates of deposits (LTNCDs) at a rate of 4.25 percent per year for a seven-year tenor.

This follows the bank’s issuance of the same instruments worth P8 billion and with tenor of 5.5 years. Demand for this instrument had been so strong prompting the bank to issue another tranche “to satisfy unmet client demand.”

Metrobank earlier received the approval of the Bangko Sentral ng Pilipinas for an LTNCD program of up to P20 billion, to be issued in tranches with tenors ranging from 5.25 years to 10 years. The bank has up to the first quarter of 2015 to complete the program.

LTNCDs are negotiable certificates of time deposits and are tax-exempt for qualified individuals if held for at least five years. These are bank products with long tenors which are offered to investors looking for yields higher than the interests on regular savings accounts or shorter-term deposits. These instruments are insured by Philippine Deposit Insurance Corp. (PDIC) up to a maximum of P500,000 per depositor.

The public offering period for the new tranche of LTNCDs started yesterday and will run up to Nov. 14. The bank, however, reserves the right to adjust the timing of the offer period.

The new LTNCDs, which will mature on Nov. 21, 2021, are offered at a minimum investment size of P50,000 with increments of P50,000 thereafter.

Metrobank mandated The Hong Kong and Shanghai Banking Corp. Ltd. and ING Bank N.V., Manila Branch as joint lead arrangers and selling agents for this transaction.

Metrobank, First Metro Investment Corp. and Multinational Investment Bancorp. will also serve as selling agents for the offer. MIB will act as market maker for the secondary trading of the LTNCDs while the instrument is not yet listed on the Philippine Dealing and Exchange Corp.

Metrobank obtained investment grade rating status from global credit watchdog Moody’s Investors Service last year. The bank has a financial strength rating and deposit rating of Baa3, at par with the Philippine sovereign rating.