RIZAL Commercial Banking Corp. (RCBC) is tapping the local debt market to raise funds for lending facility under its sustainable financing initiative.
The Yuchengco-led bank is currently offering 2.5-year and 5.25-year fixed-rate Asean (Association of Southeast Asian Nation) Sustainability Peso bonds with a minimum size of P3 billion and has an option to upsize. Public offering began on March 12 and will conclude by March 19.
The bonds, which were priced on March 11, have fixed interest rates of 3.2 percent per annum for the 2.5-year tenor and 4.18 percent per annum for the 5.25-year tenor.
RCBC tapped Standard Chartered Bank (SCB) as the sole lead arranger and bookrunner of the transaction while RCBC Capital Corp. is the financial advisor. Both SCB and RCBC are the selling agents.
Proceeds are also allocated to support the bank’s asset growth, to fund general corporate matters and to refinance maturing liabilities, in addition to financing eligible loans cited in its sustainable finance framework.
RCBC’s sustainable finance framework has been certified by Sustainalytics, an independent environmental, social and governance research and ratings provider.
The transaction is the sixth drawdown from the bank’s P100-billion bond and commercial paper program. Previously, RCBC launched P15-billion Asean Green Bond in February 2019, P8-billion Asean Sustainability Bonds in June 2019, P7.5-billion in November 2019, and P7.05-billion bonds in March 2020 and P16.6-billion bonds in July 2020.
Earlier, the listed bank said it was also aiming to issue a benchmark-sized foreign currency denominated senior note offering in 2021. It made its debut in the offshore bond market with a $300-million Reg S issuance in August last year.
RCBC booked P5.018 billion in net earnings last year, a 7-percent decline from P5.388 billion in 2019, as impairment losses jumped by 26.1 percent to P9.33 billion.
As of end-December 2020, total assets and capitalization stood at P770.8 billion and P101.5 billion, respectively. Capital adequacy ratio and common equity tier 1 are currently at 16.1 percent and 12.6 percent, respectively.
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