Security Bank sees strong demand for LTNCD offering
Ahead of the further softening of local interest rates, Security Bank Corp. sees a strong retail demand for its fresh offering of high-yielding deposits, an exercise which is expected to generate over P5 billion.
The ongoing offering of long-term negotiable certificates of time deposits (LTNCDs)—which will run until Sept. 4 this year—has an indicative pricing of 3.75 percent to 4 percent a year for a tenor of five and a half years.
“I think the timing is impeccable. This is the time when we can offer tax-efficient long-term investments for our clients at a time when the BSP (Bangko Sentral ng Pilipinas) is telegraphing low inflation and low interest rates in the coming future,” Security Bank president and CEO Sanjiv Vohra said in a briefing on Thursday.
“Before the rates get lower, this is an excellent opportunity for our clients to lock (funds) into our LTNCD offering. Therefore, we are expecting this to be a huge success,” he said.
Security Bank has an authority to offer up to P20 billion worth of LTNCDs within one year and this is the first tranche of this offering. For this tranche, the bank is expected to raise over P5B.
LTNCDs carry higher yields compared to regular time deposits or savings accounts. Interest on LTNCTDs is tax-free for individual investors if the instrument is in the name of the individual holder and is held for at least five years. —DORIS DUMLAO-ABADILLA
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