Ayala-led Bank of the Philippine Islands has tapped a $400-million syndicated term loan facility from international investors to fund the expansion of its loan and investment books.
The three-year loan facility—the first of its kind for BPI in the US dollar syndicated loan market—attracted a diverse group of Asian, European and American lenders, the bank told the Philippine Stock Exchange Thursday.
Following several months of syndication and documentation, the facility generated strong interest and was heavily oversubscribed, prompting the bank to increase the amount from the base offer of $250 million.
Against a backdrop of choppy markets and elections, BPI’s lending business with top corporations grew by 25.5 percent year-on-year in the first semester, driving growth in overall corporate business to 20.4 percent. This allowed the bank to expand its loan book by 18.6 percent year-on-year to P904.38 billion in the first semester.
Also, BPI took advantage of a rallying bond market in June to unload a portion of securities originally intended to be held-to-maturity (HTM) to fund loan growth, reduce relatively expensive deposits, and enhance capital. The remaining HTM securities stood at P216.66 billion as of end of June, down by 8.17 percent from the level in the previous year. Overall investment securities ended 2.13 percent lower year-on-year at P269.33 billion.
The following acted as lead arrangers and bookrunners for BPI’s syndicated loan facility: Australia New Zealand Banking Group Ltd., The Hongkong and Shanghai Banking Corp.Ltd., Mizuho Bank, Ltd., Standard Chartered Bank, Commerzbank Aktiengesellschaft (Hong Kong Branch), Sumitomo Mitsui Banking Corp. (Singapore branch); United Overseas Bank Ltd. (through the offshore banking unit of Taipei branch); Bank of America Merrill Lynch; Hua Nan Commercial Bank Ltd. and Mega International Commercial Bank Co.
BPI grew its first semester net profit by 35.6 percent year-on-year to P12.7 billion, driven by higher interest earnings and securities trading gains. Total revenue rose by 20.9 percent to P35.2 billion, driven by a 9.6 percent growth in net interest income to P20.70 billion and a 41.7 percent growth in non-interest income to P14.5 billion.
Return on asset and return on equity stood at 1.6 percent and 16.4 percent, respectively, in the first semester.