UnionBank eyes P5B from note offer

LISTED Union Bank of the Philippines (UnionBank) looks to raise at least P5 billion from its offer of unsecured subordinated tier 2 notes.

In a disclosure on Wednesday, the lender said it has an option to upsize the offer to P20 billion.

The notes will have a tenor of 10.25 years and an interest rate of 5.25 percent per annum, paid quarterly, with the minimum investment amount of P500,000 in increments P100,000 thereafter.

UnionBank added the notes will mature on May 24, 2030, with a call option date on May 24, 2025. The offer period is from February 4 to 14, and the issue date is on February 24.

HSBC and Standard Chartered Bank are the joint lead arrangers and bookrunners of the notes. HSBC, Standard of

Chartered Bank and UnionBank are the selling agents.

The bank reported earlier it attained an all-time high net income of P14 billion last year on the back of double-digit growth in revenues.

The latest figure was 91.7-percent higher than the P7.3 billion netted in 2018. This translated to above-industry return on equity of 16.3 percent and return on assets of 2 percent.

Sustained double-digit increase in loans, substantial margin growth and strong trading gains during the year boosted the bank’s revenues by 44 percent.

Its customer loans increased by 21 percent to P393.4 billion from the solid business expansion in small and medium enterprises, credit cards, consumer loans, and commercial lending.

Asset repricing efforts, placement of funds in cost- efficient instruments, and the impact of cuts in policy rate and reserve requirement ratio, meanwhile, supported its margins to rise by 113 basis points during the year.

The bank said its total assets grew by 15 percent to P770.9 billion as of end-December 2019.

UnionBank shares increased by 50 centavos or 0.85 percent to close at P59.50 each on Wednesday.