Union Bank raises $400M

Aboitiz-led Union Bank of the Philippines has raised $400 million from an offshore issuance of senior notes, which would be used to refinance liabilities and expand its funding base.

The five-year fixed rate senior notes were priced at 3.369 percent a year, Union Bank said in a disclosure to the Philippine Stock Exchange yesterday.

This is the debut drawdown under the bank’s medium-term note (MTN) program, and followed a successful roadshow to meet with Singapore and Hong Kong investors on Nov. 16 and 17.

Earlier, Union Bank’s board approved the setting up of a euro MTN program amounting to as much as $1 billion.

MTN is a type of medium-term, flexible debt program that allows an issuer like Union Bank to tailor its debt issuance to meet its financing needs. A euro MTN is traded and issued outside of the United States and Canada.

Union Bank’s issuance was oversubscribed by more than eight times the base offer, with orders reaching more than $3.2 billion. With a strong order book from investors across Asia, Europe, Middle East and Africa, this transaction represents the largest order book garnered by a Philippine bank issuer.

Settlement of the notes issuance will be on Nov. 29.

Citigroup and Standard Chartered Bank are the joint arrangers of the MTN program and also the joint lead managers and joint bookrunners for the transaction. China Bank Capital Corp. is the domestic lead manager.