Metrobank lists 3.5-year peso bonds

Ty family-led Metropolitan Bank & Trust Co. has raised P13.75 billion from its latest issuance of local bonds, which were listed on the Philippine Dealing Exchange on Thursday.

The 3.5-year peso bonds were priced to yield 4.5 percent a year and will have quarterly interest payments, the bank disclosed to the Philippine Stock Exchange.

Citing robust demand from both institutional, high-net worth and retail clients, Metrobank upsized the issue amount from the original target of P5 billion. It also cut short the offer period by one week from Oct. 3 to 16.

ING Bank N.V., Manila branch and Standard Chartered Bank (SCB) are the joint lead arrangers for this issuance.

This offering is part of Metrobank’s P100-billion bond and commercial paper program.  Since November 2018, Metrobank has raised a total of P70.5 billion via peso bond offerings.

Many local banks have tapped the local bond market, mostly to diversify their funding source.  This was after the Bangko Sentral ng Pilipinas made it easier for banks to issue bonds.

Previously, the BSP required banks to back up 100 percent of any issuance of bonds with government securities as collateral.  If the bank won’t use government securities as collateral, then the value of collateral must exceed that of the issue size. That old regulation prevented the issuance of bonds by banks.

As of end-June, Metrobank’s consolidated assets reached P2.3 trillion while equity amounted to P296.5 billion. Capital ratios were comfortably above regulatory requirements, with total capital adequacy ratio at 17.1 percent and common equity tier 1 ratio at 15.7 percent.

Metrobank operates over 950 branches and over 2,300 automated teller machines nationwide.DORIS DUMLAO-ABADILLA