BPI shortens CARE bonds offer after exceeding P3B target

Ayala-led Bank of the Philippine Islands (BPI) on Thursday said it ended the offer period of its COVID Action Response (CARE) bonds a week earlier, after exceeding the planned issue size of P3 billion.

In a regulatory filing, BPI said it concluded the offer on Wednesday, July 8, more than a week ahead of the originally scheduled July 17, 2020.

"[S]ubscriptions in support of the country's maiden COVID response bonds exceeded the initially planned issue size of P3 billion," the disclosure read.

The CARE Bonds have a tenor of 1.75 years, and an interest rate of 3.05% per annum paid quarterly in arrears.

BPI said the proceeds of the CARE Bonds will be used to finance and refinance eligible micro, small, and medium enterprises (MSMEs) under the bank's Sustainable Funding Framework.

"The bank values the significant contribution of MSMEs to the economy and aspires to help these enterprises bounce back from the paralysis caused by the pandemic," it said.

The bonds are slated for issuance and listing on the Philippine Dealing & Exchange Corp. (PDEx) on August 7, 2020.

BPI tapped BPI Capital Corp. and The Hongkong and Shanghai Banking Corp. Ltd. (HSBC) as the joint lead arrangers. BPI Capital was the sole selling agent, while HSBC was participating selling agent.

In May, Trade Secretary Ramon Lopez said over 525,000 or 52.66% of MSMEs in the country had to stop operations due to the lockdowns imposed to prevent the spread of the coronavirus.

Micro enterprises are defined as those with total assets worth less than P50,000; cottage enterprises with assets worth P50,001 to P500,000; small with P500,001 to P5 million; and medium from over P5 million to P20 million. 

The Department of Trade and Industry (DTI) last month said its P1-billion loan program for small and medium enterprises has already been oversubscribed, making the need to secure more funds.—AOL, GMA News