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PNB gets SGX approval for term note program

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PHILIPPINE National Bank (PNB) has secured approval from the Singapore Stock Exchange (SGX) for the listing of its $1-billion medium-term note (MTN) issuance.

The Tan-led lender said in a disclosure to the local bourse on Friday that it has “secured approval-in-principle from the [SGX]” for the listing of the notes and the MTN program to be issued there.

“PNB may from time to time issue, offer, or sell notes in the aggregate amount of up to [$1 billion] or its equivalent in other currencies,” the lender said.

The amount, tenor, number of tranches and other terms and conditions will be subsequently approved.

Citigroup Global Markets Limited, MUFG Securities EMEA Plc, Standard Chartered Bank and Wells Fargo Securities, LLC were tasked to act as lead arrangers and dealers for the issuance.

Earlier this month, the lender announced it was looking to raise $1 billion in fresh funds through a euro-denominated MTN, as confirmed by its board.

Banks usually employ a note facility to raise more capital to fund its programs and operations by issuing unsecured fixed rate notes.

Meanwhile, Moody’s Investors Service has assigned an investment-grade rating to PNB’s note issuance.

The credit rater said in a statement on Friday that it has assigned a (P)Baa2 long-term senior unsecured rating to the euro-denominated MTN program, a notch above the minimum investment grade.

Moody’s added that its rating to the note program “is underpinned by PNB’s baa3 baseline credit assessment (BCA) and a one-notch uplift to reflect Moody’s assumption that the bank will receive support from the [g]overnment of the Philippines (Baa2 stable) in times of need.”

Aside from this capital-raising note program, PNB said in January that it is planning to raise up to P20 billion by selling peso-denominated long-term negotiable certificates of deposit (LTNCD).

The bank said the proceeds will be used to extend the maturity profile of PNB’s liabilities and raise long-term funds to support its business.

LTNCDs are similar to regular time deposits which offer higher interest rates, but these cannot be pre-terminated. Being “negotiable” means these can be traded at the secondary market prior to maturity date.

PNB booked an P8.2-billion net income in 2017, 14% higher than the P7.2 billion it recorded the previous year on the back of the growth in its core operating income.

Shares in the bank closed unchanged on Friday. — Karl Angelo N. Vidal