Philippine-based Asia United Bank Corp (AUB) is targeting to raise up to $107 million (P5 billion) in its latest public offering of long-term debt notes meant to strengthen its capital base.
Classified as Tier 2 unsecured subordinated notes, AUB started the offer on Wednesday to run until
November 16, 2015. The issue date is slated on November 25, 2015. The bank, however, noted it reserves the right to shorten the offer period as needed.
The net proceeds is expected to strengthen AUB’s capital adequacy based on the requirements of the
Bangko Sentral ng Pilipinas (central bank of the Philippines).
“By continuously embarking on ways to redefine our value proposition to our clients, we are staying a step ahead in innovation and technology, as well as reaching out to more customers who are starting to reap the benefits of our investment in expanding our network and in product offerings. This is why having a strong capital base is important in supporting our ambition to become one of the top ten leading banks in the Philippines,” said AUB president Abraham Co.
AUB further disclosed it will issue the Tier 2 notes in one or more tranches within one year. The issue will have a maturity of 10 years from the issue date of each tranche. At its option, the bank may redeem any tranche of the Tier 2 notes on any interest payment date falling after the fifth anniversary of the tranche’s issue date.
The issue price is at 100 per cent of the face value of the notes. The indicative yield ranges from 5.5 per cent to 5.875 per cent with the final rate to be announced at the end of the offer period.
The minimum investment amount is P500,000 with additional increments of P50,000.
BDO Capital and Investment Corporation (BDO Capital) and Deutsche Bank AG Manila Branch (DB) will act as joint lead arrangers and joint bookrunners for the transaction. The other selling agent is Multinational Investment Bancorporation, with AUB also acting as a limited selling agent.
AUB is among the top 20 banks in the Philippines with an asset size of P131.4 billion as of June 30, 2015. It has a network of more than 200 branches and 239 ATMs nationwide, in addition to being one of the most active innovators in the online banking space as early as 2007.
AUB’s last trading price increased 0.20 per cent or P0.100 to close at P49.00.