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China Bank to offer P20-B high-yield deposit instruments

/ 05:22 AM July 05, 2019

Sy family-led China Banking Corp. is raising as much as P20 billion from an offering of high-yielding deposits to fund its growth agenda in the years ahead.

Proceeds from the long-term negotiable certificates of time deposit (LTNCTDs) would be used to support the bank’s asset generation plans and expansion programs, China Bank said in a disclosure to the Philippine Stock Exchange Thursday.

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LTNCTDs usually offer higher yields compared to regular time deposits or savings accounts.

Unlike regular time deposits, LTNCTDs cannot be preterminated by holders. However, investors can negotiate or transfer their holdings in the secondary market prior to maturity.

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Interest on LTNCTDs is tax-free if the instrument is in the name of the individual holder and is held for at least five years.

China Bank grew its net profit in the first three months by 24 percent year-on-year to P1.9 billion on higher interest income, fee-based earnings, Treasury gains and sale of idle assets.

Total assets expanded by 23 percent to P889 billion in tandem with the growth of its core businesses. The loan book rose by 13 percent to P515 billion, driven by strong demand from all customer segments.

On the funding side, deposits rose by 17 percent to P720 billion, underpinned by a 20-percent increase in low-cost deposits like checking and savings accounts.

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TAGS: China Bank, China Banking Corp.
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