Metropolitan Bank and Trust Co. (Metrobank), one of the country’s largest banks, is planning to offer P20-billion worth of long-term negotiable certificates of deposit (LTNCDs), or high-yielding, negotiable deposit instruments covered by the Philippine Deposit Insurance Corp. (PDIC).
In a filing with the Philippine Stock Exchange, Metrobank disclosed that it has received the go-signal from its board to issue up to P20-billion worth of LTNCDs early next year.
The first tranche of the program is expected to be launched early next year, subject to receipt of regulatory approvals, the disclosure added.
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.
Also, LTNCDs are insured by the PDIC for up to P500,000 and are tax exempt for qualified individuals if held for at least five years.
“The bank intends to take advantage of the ample liquidity in the market and to lock-in long-term funding,” Metrobank said.
Metrobank was recently upgraded to investment grade status by Moody’s Investors Service. The bank has a Bank Financial Strength Rating (BFSR) and deposit rating of “Baa3,” at par with that of the Republic of the Philippines.
Metrobank ended the first semester 2013 with P1.2 trillion in consolidated assets and the largest consolidated branch network among Philippine banks, with 832 domestic branches supplemented by 1,822 ATMs nationwide.
Last week, two listed banks, Union Bank of the Philippines (UBP) and Philippine National Bank (PNB), separately raised more than P3 billion through a successful LTNCD offering. PNB raised P4 billion, while UBP raised P3 billion.