METROPOLITAN Bank and Trust Company (Metrobank) is closing the offering of its long- term negotiable certificates of time deposit (LTNCDs) early due to oversubscription.
In a disclosure to the stock exchange on Friday, Metrobank said it will be closing the LTNCD offer on Monday, September 5, from its original offer run of from August 30 to September 12, Monday.
The issue and listing date of the LTNCDs is still scheduled on September 19.
The bank earlier said it plans to raise at least P5 billion from the LTNCD offer, which will be determined after the offer period ending September 5.
The LTNCDs will have a tenor of seven years with an interest rate of 3.5 percent per annum payable on a quarterly basis.
Selling LTNCDs is a way for banks to raise funds, usually in huge amounts. The bank is obliged to pay the face value of the certificate upon maturity, and produce periodic coupon or interest payments during the life of the deposit.
As an investment, LTNCDs are tax-exempt for qualified individuals or institutions if held for at least five years and are insured by the Philippine Deposit Insurance Corp. (PDIC) for up to P500,000.
ING Bank was appointed sole arranger, bookrunner and selling agent of the time deposit offer.
“The purpose of the issuance of the LTNCD is to diversify the maturity profile of funding sources and to support business expansion plans,” Juan Placido Mapa 3rd, Metrobank vice president and investor relations head, said earlier.
The bank’s expansion plans are focused on growing its loan books. It is also on a three-year branch expansion program, targeting about 30 branch openings per year toward 2018.
Metrobank reported that revenue from its lending business grew 24 percent to P920.5 billion in the first six months of the year from a year ago.
To date, Metrobank has opened nine new bank branches and installed 59 automated teller machines (ATM), increasing its branch count to 954 and ATMs to 2,285.
The bank has programmed capital expenditure of P7 billion this year, of which P4.9 billion is allotted for information technology (IT) systems.
Metrobank is the banking arm of businessman George Ty under the umbrella of conglomerate GT Capital Holdings Inc.