BDO to issue P5B worth of long-term deposit certificates

BDO Unibank Inc. (BDO), the main banking arm of Henry Sy's SM Group, will issue up to P5 billion worth of long-term negotiable certificates of deposit (LTNCDs) to support its medium-term objectives and help lengthen the maturity profile of its deposit base.

 

LTNCDs are negotiable and can be sold to other investors in the secondary market. They represent a bank’s obligation to pay the face value upon maturity with periodic coupon or interest payments during the life of the deposit.

 

In a disclosure to the Philippine Stock Exchange on Monday, BDO said the LTNCDs will mature in five and one-half years. The indicative pricing will be in the 4 percent area and will be made final at the end of the offer period.

 

Interest will be paid quarterly and will be tax exempt for individual investors if held for more than five years. The minimum investment is P100,000 with increments of P50,000. The offer period is from March 4 to March 15, 2013 with the issue date set for March 25, 2013.

 

LTNCDs are covered by deposit insurance with the Philippine Deposit Insurance Corp. up to a maximum amount of per depositor.

 

Standard Chartered Bank and ING Bank N.V. Manila Branch are the joint lead arrangers and selling agents for the LTNCD while BDO and BDO Private Bank are the other selling agents. — VS, GMA News