RCBC raises $200M from sale of debt notes

MANILA, Philippines—The Yuchengco-led Rizal Commercial Banking Corp. raised $200 million from the sale of a five-year debt paper during a warmly received return to the offshore bond market.

The notes are priced at par with a coupon and yield of 5.25 percent, which was lowered from the initial guidance of 5.375 percent following strong demand for the debt offering.

“The transaction marks RCBC’s successful return to the international capital markets after its senior debt offering in February 2010. The transaction was executed in line with RCBC’s objective of tapping opportunistic funding and taking advantage of the prevailing low interest rate environment,” the bank disclosed to the Philippine Stock Exchange on Thursday.

The notes accumulated orders of $390 million, almost two times oversubscribed on the final deal size and almost three times oversubscribed based on the initial deal size of $150 million.

RCBC initially came to the overseas markets seeking to raise $150 million of new funding but upsized the transaction by $50 million “on the back of robust demand from investors globally, including strong support from onshore Philippine investors,” the disclosure said.

It was disclosed that about 54 investor accounts took up the debt notes, driven by demand from Asia (92 percent) and Europe (8 percent). By investor type, about 32 percent of the issue was taken up by asset managers while 65 percent was gobbled up by banks. The remaining 3 percent went to other investors.

“The transaction represents the bank’s inaugural drawdown off of its US$1 billion EMTN [euro medium term note] Program established in September 2011. To date, RCBC is the only issuer in the Philippines with an EMTN Program, providing it flexibility to access international capital markets through a variety of currencies and financial instruments,” the disclosure said.

They are expected to settle on January 30, 2012, and afterwards be listed on the Singapore Stock Exchange. Standard Chartered Bank acted as sole bookrunner for the transaction. The notes will mature on January 31, 2017.