AUB to issue up to P2B in deposit certificates

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To boost its lending activity, the Asia United Bank (AUB) announced that it will issue the first tranche of long-term negotiable certificates of time deposits (LTNCDs).

In a statement, the bank said that the issue size will be up to P2 billion with a maturity of 5.25 years from the issue date on December 12, 2013.

“HSBC acts as sole arranger, bookrunner and selling agent while AUB, First Metro Investments Corp. and Multinational Investment Bancorporation are the other selling agents,” it stated.

Subject to prevailing market conditions. AUB noted that the interest rate for the LTNCD is set at 3.25 percent to 3.75 percent.


Antonio Agcaoili Jr., AUB executive vice president and head of treasury, said that the issuance of the new time deposit instruments will enable the bank to further improve its liability management, and match the funding of its long-term assets.

“As LTNCD is tax-free because of its long tenor, AUB can pass on the benefits to our clients through offering better yields,” he said.

AUB grew its asset base by 57 percent to P96.9 billion year-on-year as of September 2013. This was largely due to the 33-percent expansion in its total loan portfolio to P39.4 billion, while its deposit base increased by 45 percent to P68.8 billion during the period.

The bank earned P949 million as of the first three quarters, a slight dip from P1 billion in the same period last year.

Its net interest margin stood at 4.1 percent from 3.9 percent a year ago. Capital funds rose 62 percent to P17.9 billion, boosting its capital adequacy ratio (CAR) to 19.5 percent.

On the other hand, the bank also plans to continue widening its customer reach nationwide, with AUB now having 142 branches as of October 2013.

“We will open more branches this year to reach out to more AUB clients nationwide,” said Manuel Gomez, AUB executive vice president.

Coming on the heels of a successful public listing in May and its upgrade to universal banking status, AUB targets to grow its network to 200 branches by 2014.

Its subsidiary, the Rural Bank of Angeles (RBA), also recently secured regulatory approval to acquire the banking business of the Cooperative Bank of Pampanga, a rural cooperative operating since 1978.

The acquisition will add 20 more branch licenses in restricted areas and further expand RBA’s microfinance and countryside lending activity in Pampanga.

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