FMIC launches P5B bond offer

MANILA, Philippines—First Metro Investment Corp., the investment house of the Metrobank group, has launched a retail bond offering of up to P5 billion in a bid to stretch out its funding base.

In a disclosure to the Philippine Stock Exchange, FMIC said the bonds will have two tenors: five years and three months, as well as another tranche with seven years in tenor.

The five-year bonds are being offered at an interest rate of 5.5 percent and the seven-year bonds at 5.75 percent.

British bank Standard Chartered was mandated as bookrunner for the offering, which will run until August 3. Target issue date is August 10.

“The transaction is primarily a liability management exercise to lengthen the company’s deposit tenor base,” FMIC president Robert Juanchito Dispo said in a text message.

“Proceeds will be deployed in government securities as these are risk-free, highly liquid and presents good capital gains potential in the light of receding domestic rates,” Dispo added.

FMIC grew its first-quarter net profit by 127 percent year on year to P979 million due to a hefty increase in treasury earnings and trading gains. The latest results translated to a return on equity of 31.5 percent.