Security Bank plans P20B deposit offer

Local banking giant Security Bank Corp. plans to raise as much as P20 billion from an offering of high-yielding long-term deposit notes, harnessing ample liquidity in the financial system to fund expansion plans.

In a disclosure to the Philippine Stock Exchange on Tuesday, Security Bank said its board of directors had approved the issuance of long-term negotiable certificates of deposit (LTNCDs).

The issuance will be subject to regulatory approval, the bank said.

The last time the bank tapped the LTNCD market was in 2014.

LTNCDs are negotiable certificates of time deposits and are tax exempt for qualified individuals if held for at least five years. The LTNCDs are insured by the Philippine Deposit Insurance Corp. (PDIC) up to a maximum coverage per depositor, currently at P500,000. These are bank products with long tenors, usually five to 10 years, which are offered to investors looking for a higher interest rate compared to regular savings accounts or shorter-term deposits.