AUB gets BSP nod to issue

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P5-B notes Listed bank Asia United Bank Corp. (AUB) has secured approval from the Monetary Board to pursue its plan to issue up to P5-billion worth of long-term negotiable certificates of deposit (LTNCDs), or high-yielding deposit instruments.

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“Having received Bangko Sentral ng Pilipinas [BSP] approval, the Board [of AUB]ratified its resolution and authorized the issuance to the public of LTNCDs up to a maximum aggregate principal amount  of P5 billion in one or more tranches over a period of  one year,” AUB said in its disclosure to the Philippine  Stock Exchange.

LTNCDs are negotiable certificates of time deposit with a designated maturity or tenor representing a bank’s obligation to pay the face value upon maturity, as well as make periodic coupon or interest payments during the life of the deposit. LTNCDs are also insured by the Philippine Deposit Insurance Corp. for up to P500,000 and are tax exempt for qualified individuals if held for at least five years.

In the same disclosure to the exchange, AUB likewise announced BSP’s approval to its plan to create an AUB Peso Money Market Fund, as well as provide additional details on its acquisition of a rural bank in Pampanga.

Having received BSP’s go signal, the board of AUB ratified the purchase by the Rural Bank of Angeles Inc. (RBAI) of all the Cooperative Bank of Pampanga’s assets, as well as the assumption of its liabilities.

For the said purpose, AUB authorized the release of funds to recapitalize RBAI in such amount as necessary for the rural bank to meet the 15-percent Capital Adequacy Ratio requirement under Strengthening Program for Cooperative Banks Plus progra, but in no case lower than P400 million.

Madelaine B. Miraflor

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