BDO to redeem P15-B Tier 2 notes

By SIEGFRID O. ALEGADO, GMA News

Published August 14, 2013 12:31pm

Sy-led BDO Unibank Inc., the country’s largest in asset terms, is exercising the option to redeem early P15-billion worth of unsecured subordinated notes starting next month, the bank said in a disclosure to the Philippine Stock Exchange on Wednesday.

The redemption is on September 27 for P8.5 billion worth of Series 4 notes and on October 7 for P6.5 billion worth of Series 5 Tier 2 notes, both at par value, plus accrued and unpaid interest.

It did not say how much it will spend to pay back its debt.

The early redemption is in line with the Bangko Sentral ng Pilipinas' adoption of Basel III rules by January next year.

Under the soon-to-be implemented bank capital regulations, aimed at strengthening the financial system, existing Tier 2 notes won't qualify as capital, the bank noted.

The Sy-led bank is now waiting for the Bangko Sentral to give go signal on other notes for redemption.

"BDO also applied for BSP approval of the optional redemption of the P3.0-billion unsecured subordinated notes eligible as Tier 2 capital issued by the bank on March 20, 2009 (the Series 3 notes)," the bank said in an e-mail response to GMA News Online.

Last July 29, the BDO board of directors approved the early redemption of "Unsecured Subordinated Debt Qualifying as Tier 2 Capital" Series 3, 4 and 5 totaling P18 billion. — VS, GMA News

Tags: debt, bdounibank, tier2notes, debtredemption