BPI secures P 27B from latest bond offering

Ayala-led Bank of the Philippine Islands (BPI) has raised P27 billion from a warmly received offering of two-year bonds, which were listed on the local fixed income platform last Monday.

BPI upsized the offering of the retail bonds, which are due in 2024 and carry an interest rate of 2.8068 percent per annum, from the original base offer of P5 billion.

The bank earlier shortened the period for the offering amid robust demand. This also marked the fourth tranche of peso-denominated fixed-rate bonds under BPI’s P100-billion bond program that was approved by its board of directors in late 2019.

Part of the proceeds will be used to settle older debt and for digitalization initiatives.

BPI Capital Corp. and The Hongkong and Shanghai Banking Corporation Ltd. (HSBC) acted as the joint lead arrangers. BPI Capital was the sole selling agent, while HSBC was participating selling agent.

In its offering prospectus, BPI reported an increasing shift in customer behavior from transacting in person at a physical location to transacting online amid the pandemic. As of end-September 2021, 91 percent of BPI’s total transactions had been conducted through digital platforms, with only 9 percent coursed through in-branch transactions.

Rationalizing branches

As the bank continues to make significant investments in digitalization, it intends to rationalize its branch footprint. BPI believes digitalization will enable its branches to provide more meaningful interactions that address the increasingly complex financial needs of clients. Digital banking and branch banking are seen to exist side by side, with different purposes for each customer.

Although some clients still prefer discussing their financial needs face-to-face, BPI said digital banking could accord its clients more choices and greater control of their interactions with the bank.

Hitting market consensus forecast, BPI delivered P23.88 billion in full-year 2021 net profit, rising by 11.5 percent from the previous year as earnings accelerated in the fourth quarter amid relaxed lockdown protocols. INQ