BPI sets up $2-B MTN facility | Inquirer Business

BPI sets up $2-B MTN facility

/ 05:18 AM June 15, 2018

Ayala-led Bank of the Philippine Islands (BPI) has set up a medium term note (MTN) facility worth up to $2 billion to obtain flexibility in raising funds as needed.

The MTN program was recently approved by the bank’s board in this amount or its equivalent in other currencies, BPI said in a disclosure to the Philippine Stock Exchange on Thursday.


The 166-year-old bank said this was “part of the bank’s initiatives to maximize flexibility in accessing funding expediently.”

The issuance of notes under the program will be subject to market conditions and will be determined by requirements of the bank’s business, the disclosure said.


An MTN program allows an issuer to have constant cash flow coming in from its debt issuance, typically with tenors of five to 10 years. This allows a company to tailor its borrowing to meet its financing needs. Such notes allow the issuer to register with the Securities and Exchange Commission (SEC) only once, using the shelf registration window, instead of every time for differing maturities.

A corporate MTN can be continuously offered by a company to investors through a dealer with investors being able to choose from different maturities. As such, they are different from corporate bonds because they can be offered to investors by the issuer’s agent instead of being underwritten by investment banks and then sold to the public in a tranche.

Meanwhile, BPI seeks to elevate the bank’s digital infrastructure to bring innovative services to existing and future clients as well as to support the Bangko Sentral ng Pilipinas’ (BSP) initiative to develop a National Retail Payment System (NRPS), which involves policies and standards for a “cash-lite” economy.

“It’s about shaping and creating a whole new experience for our customers through digitalization, offering them a better, safer, more convenient way to bank with us. A cash-lite economy will bring significant benefits to our country,” BPI president Cezar Consing said in a statement.

“This long-term digitalization journey will enhance our extensive network of ATMs, CAMs (Cash Acceptance Machines), online facility, and mobile app to enable us to offer convenient, self-service banking,” he added.

BPI Enterprise Services head Ramon Jocson said the process of digitalization, despite inevitable hiccups along the journey, would eventually lead to exceptional customer experience as more people gain more confidence in doing online and mobile transactions.

“Many of BPI’s clients now are digitally savvy. Many of our clients have come to embrace technology because of the convenience, safety and reliability it offers. The proliferation of smartphones has also stimulated innovation, allowing our customers to save time through a wide array of transactions they can do anytime and anywhere,” he said.

He clarified, however, that digitalization would not mean doing away with the branches, but enabling the branches for more meaningful interactions that address the financial needs of clients.

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