BDO subordinate notes get MB nod

REPORT FROM BUSINESSWOLRD The policymaking Monetary Board has approved the plan of Banco de Oro Unibank, Inc. (BDO) to raise up to P10 billion worth of unsecured subordinated debt. BDO President Nestor V. Tan last week said the bank needed to boost its capital to finance its expansion, including the cost of integration of the Sy-led bank with Equitable PCI Bank. Bangko Sentral ng Pilipinas Deputy Governor Nestor Espenilla said the Monetary Board has approved the Sy-led bank’s plan during the policymaking body’s meeting last Thursday. BDO would float 20-year subordinated notes that would qualify as Tier 2 capital, or secondary bank capital that sits low in the bank’s hierarchy of payments. The Tier 2 notes are callable after five years. BDO’s market capitalization stood at $3.5 billion (P160 billion), following its merger with Equitable PCI Bank late last year. The bank posted a net income of P3.18 billion in the first half, up by 25% from last year’s P2.5 billion. Recently, the Sy-led bank forged an agreement with the Bank of China, Ltd. (BOC) to promote the latter’s business in the Philippines and BDO in China. "The agreement makes it possible for both banks to mutually collaborate on financial transactions and provide other forms of assistance and services to clients of both BOC and BDO," BOC Manila Branch General Manager Sun Bao Xiang earlier said in a statement. - BusinessWorld