Union Bank raises P5.8B from bond offer

MANILA, Philippines — Aboitiz-led Union Bank of the Philippines (UnionBank) has raised P5.8 billion from a new offering of local retail bonds, proceeds from which will supplement its funding base and support business expansion plans.

The three-year bonds carried a coupon rate of 6 percent, the bank said in a press statement on Thursday.

This is the second bond issuance by UnionBank, following the issuance of P11 billion bonds last December 7.

The bank announced an initial P3 billion offering size, but ended up upsizing the deal after receiving strong demand from institutional and retail clients. The brisk demand also allowed UnionBank to price the bonds at the lower end of its guidance.

“Our peso bond issuance is part of our ongoing efforts to diversify our funding sources and lengthen the maturity profile of our liabilities. This instrument allows us to comply with the new liquidity and funding ratios at a lower intermediation cost,” said Union Bank senior executive vice president, chief financial officer, and treasurer Jose Emmanuel Hilado.

Hongkong and Shanghai Banking Corp. Ltd. (HSBC) and ING Bank N.V. Manila branch acted as joint lead managers and bookrunners for the transaction. HSBC and ING were also selling agents alongside UnionBank.

The bonds will be issued on June 3 and listed on the Philippine Dealing Exchange (PDEx) on the same day.