PNB to raise up to P20B from LTNCD issuance

January 23, 2018 - 7:46 AM

MANILA – The Philippine National Bank (PNB) is planning to raise up to P20 billion by selling peso-denominated long-term negotiable certificates of deposit (LTNCD).

In a disclosure to the stock exchange, the Lucio C. Tan-owned bank said its board of directors on Monday approved the issuance of up to P20 billion peso-denominated LTNCDs in one or more tranches.

The offering will still require approval from the Bangko Sentral ng Pilipinas (BSP).

“The proceeds will be used to extend the maturity profile of the Bank’s liabilities as part of overall liability management, support compliance with required BSP liquidity ratios, and raise long-term funds for general corporate purposes,” PNB said.

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

In October 2017, PNB raised P6.35 billion worth of LTNCDs, the third and final tranche for the bank’s P20-billion long-term note offering since November 2016.

The bank reported a net income of P4.51 billion during the first nine months of 2017, a 20% drop from the P5.67 billion recorded during the same period in 2016. PNB’s earnings in 2016 included one-time gains from the disposal of foreclosed assets, and the sale of its 51% stake in PNB Life Insurance Inc. to Allianz SE, among others.

Shares in PNB fell by 0.9% or 5 centavos to P56.60 each on Monday.