Metrobank raises $1 billion from bond offering
METROPOLITAN BANK & Trust Co. (Metrobank) has raised $1 billion through an offering of five- and 10-year dollar-denominated senior unsecured notes following strong demand from global investors, it said on Thursday.
The amount raised from the dual-tranche issuance was double the initial target of $500 million as the offer was more than 11 times oversubscribed, with orders from global investors reaching $5.6 billion, the bank said in a disclosure to the stock exchange.
The Reg S five-year and 10-year bonds fetched coupon rates of 5.375% and 5.5%, respectively, 110 basis points (bps) and 130 bps above benchmark US Treasury rates.
Both notes will be settled on March 6 and will be listed on the Singapore Exchange Securities Trading Ltd.
“We are positively overwhelmed with the high interest we received from global investors for this issuance. It shows their strong confidence on Metrobank’s credit and track record in the Philippines. This offering will fund the bank’s key growth initiatives as we continuously develop innovative financial solutions to serve our clients,” Metrobank President Fabian S. Dee said in a statement on Thursday.
“We are grateful for the support shown by global investors in our return to the international bond market after a three-and-a-half-year hiatus… The proceeds of this fund raising will enable the bank to support our growing pipeline of customer transactions as the Philippine economy accelerates its growth,” Metrobank Financial Markets Sector Head Fernand Antonio A. Tansingco said.
The notes are part of the Metrobank’s $2-billion medium-term note program approved by its board of directors in March 2017.
“Proceeds of the bond issuance will be used to diversify the bank’s funding sources and establish a benchmark for Philippine bank credit in the international capital markets,” the lender said.
The bank said 86% of the notes’ investors came from the Asia-Pacific, while the remaining 14% came from Europe, Middle East and Africa. In terms of investor type, 73% of the issue was allocated to fund managers, 14% to banks or financial institutions, and the remaining 13% to insurers, corporations and private banks.
Moody’s Investors Service rated the bond issue at “Baa2,” matching the Philippines’ investment grade sovereign rating.
BofA Securities and UBS were the joint global coordinators and bookrunners for the issuance, with Mitsubishi UFJ Financial Group and First Metro Investment Corp. mandated as joint bookrunners.
“This issuance established several records: the longest senior dated note by a private sector bank in the Philippines, the largest non-sovereign note issuance of $1 billion, and the tightest ever credit spreads on the 5-year tranche among non-sovereign Philippine issuers,” the lender said.
Metrobank’s attributable net profit rose by 28.87% year on year to P42.238 billion in 2023.
Its shares closed at P62 each on Thursday, down by 95 centavos or 1.51%. — A.M.C. Sy
