Union Bank upsizes offshore notes issue by $100M

Aboitiz-led Union Bank of the Philippines has raised an additional $100 million from the offshore issuance of five-year senior notes, riding on strong investor appetite for its medium-term note (MTN) program.

In a disclosure to the Philippine Stock Exchange on Monday, Union Bank said it had upsized its 3.369-percent senior notes, bringing the size of the notes maturing on November 2022 to $500 million.

The issue was upsized to accommodate strong demand during the bank’s inaugural drawdown from the MTN facility.

The notes are issued under UnionBank’s MTN program which was established last November 14, 2017. MTN is 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.

“The proceeds of the notes will be used to refinance UnionBank’s existing liabilities, expand its funding base and for other general corporate purposes,” the disclosure said.

The notes are rated Baa2 by Moody’s and will be listed in the Singapore Stock Exchange. Baa2 is the ninth highest rating in Moody’s long-term corporate obligation rating, indicating that the obligations are considered medium-grade and subject to moderate credit risk

Citigroup Global Markets Limited and Standard Chartered Bank acted as joint lead managers and joint bookrunners for the transaction.

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

Union Bank’s issuance attracted a strong order book from the investors across Asia, Europe, Middle East and Africa, this transaction represents the largest order book garnered by a Philippine bank issuer.