Lucio Tan-led Philippine National Bank will launch on Monday a new tranche of debt notes qualifying as tier 2 or supplementary capital worth up to P3.5 billion.
In a statement on Friday, PNB said the indicative yield to maturity of the 10-year notes would be between 5.75 percent and 6 percent.
PNB has the right to redeem the bonds on the fifth year subject to Bangko Sentral ng Pilipinas approval and certain conditions, including meeting the capital adequacy ratio requirement.
“The net proceeds of the PNB tranche 2 notes will be used to finance asset growth. The fund will also allow the bank to maintain a strong capital base,” PNB said in a statement.
The bank ended 2011 with a capital adequacy ratio of 21.65 percent.
The offering will run until May 4 this year while the notes are targeted for issuance by May 9.
ING Bank was mandated to arrange the issue while First Metro Investment Corp. and Multinational Investment Bancorporation are the selling agents. PNB Capital and Allied Bank are limited selling agents.
PNB is set to merge this year with Allied Bank, also controlled by Tan. PNB will be the surviving entity. It is the country’s sixth largest bank in assets with P314.42 billion, which will expand by P168.28 billion with the merger with Allied Bank.
As of the end of 2011, PNB had a capital base of P36.2 billion. Its return on equity last year stood at 10.76 percent. Doris C. Dumlao