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RIZAL Commercial Banking Corp. (RCBC) told the Philippine Stock
Exchange on Friday that it has obtained fresh funds through the sale
of more unsecured subordinated debt eligible as lower Tier II
capital. The additional monies would be used to refinance its
existing obligations and boost its capital base.
The bank said the sale was oversubscribed, as
investors were willing to buy P7 billion more than what the bank had
offered as approved by the Bangko Sentral ng Pilipinas. The high
investor interest was ascribed to the offering’s “wide investor
base” appeal, attracting both institutional and retail investors.
“I am glad with the investor turnout for our
capital notes. This issuance will surely contribute to lowering the
cost of funds of the bank and boost the bank’s capital adequacy
ratio even higher,” Lorenzo V. Tan, RCBC president and chief
executive, said.
The debt papers carry a coupon rate of 7 percent
per annum issued at 100 percent of face value. Proceeds of the debt
issuance would be used to refinance RCBC’s first issue of lower
Tier II capital, callable in July this year. The additional funds
would also be used to further strengthen the bank’s capital base.
As of last year, the bank’s consolidated
capital funds expanded by P5 billion to P29 billion, boosting its
capital adequacy ratio from 16 percent to 18.7 percent. Since 2006,
the bank has been building its capital through the Hybrid Tier I and
preferred shares issues.
At-end December, the lender’s unaudited
profits surged 56 percent to P3.21 billion compared with 2006 due to
fresh capital raised, a low cost deposit campaign, “prudent”
loan growth and treasury trading.
Operating income went up by 29 percent to P10.12
billion with net interest income and non-interest income growing by
43 percent and 10 percent, respectively. The lender trimmed its
non-performing loans ratio from 7.6 percent to of 5.6 percent and
its bad assets ratio from 22 percent to 14.3 percent.
-- Likha C. Cuevas-Miel
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