Metrobank Raised Funds Through Bonds - Marvin Germo

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Metrobank Raised Funds Through Bonds

By: Marvin Germo | April 4, 2019

Successful Raise of Funds

Metropolitan Bank & Trust Co. (Metrobank) has successfully completed the offering of its P17.5 billion worth of fixed rate bonds of which the public offer ended last March 29. The firm disclosed that they reached beyond their initial target of P10 billion. The demand of its institutional and individual investors led the firm to price the bonds accordingly. And because of the increased in demand, the oversubscription was fully utilized. The bonds carry a coupon rate of 6.3% which has quarterly payment until April 2020. The listing and issuance of these bonds will be on April 11.

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Stock Smarts Cebu —  April 6 & 7, 2019
Investing Insights Japan – April 13, 2019
Stock Smarts Singapore —  May 18 & 19, 2019
Investment Conference 2019 – May 25, 2019
Stock Smarts Manila —  June 15, 16, 22, 23, & 29, 2019
Stock Smarts Iloilo – July 6 & 7, 2019
Stock Smarts Cagayan De Oro – July 20 & 21, 2019
Stock Smarts Hong Kong – August 11, 2019
Stock Smarts UAE – August 30 – September 3, 2019
Stock Smarts Qatar —  October 3 – 6, 2019
Stock Smarts Taiwan – November 2, 2019

Metrobank’s Fund Managers

The fund managers and bookrunners of Metrobank were Standard Chartered Bank and Hongkong and Shanghai Banking Corporation Ltd. during the said transaction. These banks also helped Metrobank and First Metro Investment Corporation to sell the bonds globally. The raising of P17.5 billion funds was the third division of the firm’s P100 billion bond program. As of now, the total issued bonds of Metrobank is P45.5 billion. It’s still a long way for the company to reach the end of its bond program but given the demand of the investors every time it offers bond, there’s no doubt that the banking corporation will hit its target.

Other Banks Are Raising Funds Too

Prior to this new issuance of funds, Metrobank was able to raise a P10 billion 2-year fixed rate bonds with 7.15% interest last November 2018. It was resumed in December to raise another P18 billion worth of additional funds. Metrobank is not the only one who’s starting the year right by issuing bonds. In fact, other big banks like BDO, RCBC, and Union Bank have raised their peso-denominated bonds for expansion and diversification purposes. China Bank, PNB, and Security Bank have their bond programs established through peso-denominated bonds amounting to P75 billion, P100 billion, and P50 billion respectively.

Metrobank in 2019

It can be noted that from my previous post that Metrobank had its expenses grow last 2018. Speaking of the expense side, the operating and labor expenses of Metrobank grew 10% and 11% respectively. The other expense recorded were used to improve the bank’s processes. The firm said that 2018 was turning point for them. Although the market has been challenging for the first 6 months of 2018, the company managed to grow their core income consistently. With a stronger firm at the end of 2018, the bank is considering future expansion this year via structural changes. The firm will also improve the efficiency and productivity across the organization.

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