PNB eyes at least $300M from notes

Philippine National Bank (PNB) — INQUIRER.net photo

MANILA, Philippines  — Philippine National Bank (PNB) will be raising $300 million via a medium-term note offering, to build up its coffers for its financing requirements.

In a disclosure on Monday, the Lucio Tan-led lender announced that its board had approved the issuance of the note, with an option to upsize, from its $2-billion euro medium-term note program.

The bank, however, has yet to disclose further details about the offer period and interest rates attached to the notes, among others.

PNB’s euro medium-term note program was established in 2018 to provide a funding source for the company.

In 2019, the listed financial institution raised $750 million via the offshore bond market, drawing down from the program. The offered fixed-rate senior notes maturing by September 2024 have a coupon rate of 3.27 percent per annum.

READ: PNB raises $750M via offshore bond issuance

The bank also tapped the medium-term note program for the launch of $300-million fixed-rate senior note offerings with a coupon rate of 4.25 percent annually and a tenor of five years.

Moody’s rating

Last month, credit watcher Moody’s Ratings affirmed the bank’s foreign currency senior unsecured medium-term note program rating at “(P)Baa3,” which means moderate credit risk.

Moody’s also noted that PNB’s nonperforming loan (NPL) ratio has remained “stable” at 7.3 percent as of end-2023 compared to 7.2 percent in 2022.

An NPL ratio indicates how much loans extended to clients have remained unpaid and a lower figure means less credit risk for the lender. Should NPLs rise, banks allocate a bigger credit loss provision, which will eventually hurt their bottom line.

In the first quarter, PNB grew its net income by 10 percent to P5.3 million as interest income improved by 17 percent to P16.08 billion.

Total assets stood at P1.196 trillion as of end-March, while net loans and receivables amounted to P610 billion and deposit liabilities reached P916.4 billion.

PNB executive vice president and chief financial officer Frances Albalate previously said they would strengthen consumer lending and further the reach to small and medium enterprises to drive growth this year. INQ