MANILA, Philippines–The central bank has given the green light for the banking unit of the country’s largest conglomerate to raise as much as P10 billion in funds through the issue of debt instruments.
In statement, the Bank of Commerce — an affiliate of San Miguel Corp. — said it will issue “in multiple tranches” the long-term negotiable certificates of time deposit next year “to diversify funding sources and support its expansion plans.”
“The first tranche is set in the first quarter of next year,” the bank said.
In a recent meeting, the Monetary Board of the Bangko Sentral ng Pilipinas granted the request of Bank of Commerce for the authority to issue the debt instruments in several batches tranches over a one-year period.
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Standard Chartered Bank and Philippine Commercial Capital Inc. are the transaction’s joint lead arrangers while Standard Chartered Bank, along with Bank of Commerce, will act as selling agents.
These instruments are bank deposit products denominated in Philippine pesos with a minimum maturity of five years. Individual investors who hold on to these debt securities for at least five years will enjoy tax-free interest earnings. Similar to a time deposit, long-term negotiable certificates of time deposit offer higher interest rates.
