LandBank offers P6.5-B notes to boost capital, lending

Eyeing a liquid domestic market, Land Bank of the Philippines (LandBank) on Tuesday offered Tier 2 subordinated notes to beef up its capital and lending operations, the bank said Wednesday.   The offer was launched in a briefing for investors, where the bank said it was looking at a P6.5-billion float.   “LandBank’s offering of the Tier 2 notes at the current low interest rate environment will further strengthen our capital position and, more importantly, boost our lending to farmers and fisherfolk and other priority sectors congruent with our countryside development mandate,” said LandBank president and CEO Gilda Pico.   A debt sale until Jan. 20 was scheduled, but LandBank said the self-imposed deadline is flexible depending on how investors will respond to it.   An indicative yield was set at 6 percent a year, but the final rate will be posted when the offer period ends, said Pico.   The LandBank notes — which will mature in 10 years and three months — will carry a fixed rate coupon and is priced based on prevailing 10-year PDST-F, a market-based benchmark for setting interest rates.   The notes will mature in10 years and three months from the issue date, with investors having a call option after the fifth year.   LandBank told investors it will pay fixed quarterly interests until the notes become redeemable.   The bank hired Deutsche Bank AG, Hong Kong and Shanghai Banking Corp., and Standard Chartered Bank as joint lead managers and selling agents for the transaction.   Multinational Investment Bancorporation is also a selling agent for the offer, along with LandBank and its branches on a limited basis.   A government financial institution, LandBank is among the country’s top five universal banks with a branch network and automated teller machines in 79 provinces. — VS, GMA News