Local banking giant Metropolitan Bank & Trust Co. has raised P18 billion from the reopening of two-year bonds, the issuance of which was upsized by more than three times the original offer to meet “overwhelming” demand from investors.
Metrobank reopened to the public its existing two-year bonds at an effective interest rate of 7 percent a year, the bank disclosed to the Philippine Stock Exchange.
This serves as a landmark transaction as it is the first peso-denominated bond issuance by a Philippine bank and the largest ever reissuance of existing local bonds.
The bonds were issued and consolidated to form a single series with the recently issued P10-billion fixed-rate bonds, increasing the total raised from the bonds to P28 billion, the largest peso-denominated bank bonds in the country to date.
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The reissuance was priced at a slight premium, having an effective interest rate of 7 percent and quarterly coupon payments as the bank cited the robust investor demand and strong credit that had led to a decline in the overall cost of the bond and credit spread. Metrobank’s original P10-billion two-year bond issuance was priced to yield 7.15 percent per annum.
“This serves as a significant milestone for Metrobank which has consecutively proven its ability to always be the first to market, and pioneer a reopening following its successful maiden issuance last November. This transaction has been very timely for Metrobank as we continue to prepare for a strong start coming into 2019,” Metrobank president Fabian Dee said.
