Philippine Savings Bank (PSBank), the thrift bank arm of the Metrobank Group, has secured the approval of its board of directors to proceed with its plan to issue P3-billion worth of unsecured subordinated debt.
In a filing with the Philippine Stock Exchange, PSBank disclosed that its board has passed a resolution approving the Bank’s issuance of P3 billion in unsecured subordinated debt with a term of 10 years and a call option on the fifth year.
The notes, according to the listed bank, will have a loss-absorption feature to comply with Bangko Sentral ng Pilipinas (BSP) Circular 781 on the Basel III Implementing Guidelines on Minimum Capital Requirements.
“The purpose of this issuance is to increase and strengthen PSBank’s capital base in anticipation of the early adoption of Basel III to be implemented by the BSP in 2014; and also allow the Bank to freely pursue its expansion plans,” the bank told the local bourse.
The issuance, however, is still subject to the approval of the central bank.
During the nine-month period ended September 2013, PSBank was able to drive its net income to a record high amid the continued expansion of its loan portfolio.
PSBank earlier reported a record net income of P3.2 billion in the first nine months of the year, representing a 82-percent increase from the P1.8 billion it posted in the same period last year.
Besides the expansion in its loan portfolio, the company also cited “gains from its investment portfolio” as one of its profit growth drivers.
Madelaine B. Miraflor