PSBank plans P10B LTNCD debut

PHILIPPINE Savings Bank, the thrift bank arm of the Metrobank group, plans to debut into the long-term negotiable certificates of time deposit (LTNCTD) market with an offering of as much as P10 billion.

The board of PSBank has approved the issuance of such LTNCTDs through one or more tranches over a period of one year.

“PSBank stands to benefit from the LTNCTD issuance due to continued liquidity and low interest rates in the market,” PSBank senior vice president and chief finance officer Perfecto Ramon Dimayuga Jr. said in a disclosure to the Philippine Stock Exchange on Monday.

“The LTNCTDs will provide an alternative investment outlet for PSBank’s existing clients and depositors,” he added.

Dimayuga said in a text message that PSBank was looking at a 5.25 tenor for this inaugural LNTCD offering.

LTNCDs are bank products with long tenors which are offered to investors looking for a higher interest rate compared to regular savings accounts or shorter-term deposits. They are tax exempt for qualified individuals if held for at least five years. They are insured by the Philippine Deposit Insurance Corp. (PDIC) up to a maximum coverage per depositor, currently at P500,000.

PSBank’s issuance is subject to the approval of the Bangko Sentral ng Pilipinas while its final terms, including offering period and interest rates, will depend on market conditions, the bank said.

The bank grew its first semester net income by 2.2 percent year-on-year to P1.2 billion. This was supported by a 10-percent increase in core income, composed of revenues from consumer loans, investments and fee-based income. PSBank expanded its six-month loan book by 13.2 percent year-on-year to P121.3 billion fuelled by auto and mortgage loans.

On the funding side, deposits rose by 17 percent to P139.3 billion, anchored on a 21.7-percent expansion in low-cost deposits.

Total resources rose by18.4 percent to P176.5 billion as of end-June.