UnionBank borrows $358M to retire heavier loans

Union Bank of the Philippines raised $358 million through a syndicated loan facility after attracting 15 lenders, the proceeds of which are earmarked to refinance its obligations.

In a disclosure on Friday, the Aboitiz-led bank said the three-year loan facility, which had an original launch size of $150 million, was upsized by nearly 2.5 times.

Proceeds will go to the refinancing of maturing dollar-denominated loans and bonds and funding of general corporate matters.

“This shows how UnionBank continues to gain the market’s confidence in our strategic priorities. This enables us to better manage our financing requirements and continue executing our strategy as the market remains volatile,” said Johnson Sia, UnionBank treasurer and head of global markets.

The Hongkong and Shanghai Banking Corp. Ltd. and MUFG Bank Ltd. were tapped as lead arrangers, underwriters and book runners for the transaction.

In June, it raised P11 billion from the country’s first-ever offering of digital peso bonds.

The 1.5-year bonds, issued out of the bank’s P39-billion bond program, have a fixed rate of 3.25 percent.

In August, UnionBank completed the acquisition of Citi’s consumer business, adding P98 billion worth of assets to the bank. This transaction made the financial institution among the top three credit card issuers in terms of usage and spending in the country.

The listed bank previously raised P40 billion from a stock rights offer to partly finance the Citi deal.

—Tyrone Jasper C. Piad