RCBC to issue $400-m notes
Rizal Commercial Banking Corp., a member of the Yuchengco Group of Companies and one of the biggest lenders in the country, will issue up to $400 million worth of senior notes before the year ends to finance its medium and long-term asset growth.
The bank said in a disclosure to the stock exchange Tuesday its board of directors approved the planned issuance on Sept. 28.
“The board of directors approved the issuance of up to $400 million of senior notes out of the bank’s medium term note program and a bond exchange of its $275 million senior notes due 2017...,” the bank said.
RCBC president and chief executive Lorenzo Tan said the bank would use the proceeds of the issuance of notes to fund other general corporate activities.
“We might raise this before the end of the year, subject to market conditions,” Tan said in a text message.
RCBC posted a consolidated net income of P2.53 billion in the first half of 20256, up 25 percent from P2.02 billion a year ago on the back of the strength of its core businesses.
The profit translated to an annualized return on equity and return on asset of 9.3 percent and 1.1 percent, respectively.
Net interest income reached P7.45 billion and represented 63 percent of gross income, which increased 12.4 percent to P11.8 billion. The bank achieved an annualized net interest margin of 4.2 percent, which remains one of the highest in the sector.
Tan said the bank was on track and advancing on all fronts, especially on core lending to deposits to fee-based income.
Core lending business was also sustained with loan book excluding interbank loans expanding by 18 percent to P275.7 billion. All market segments sustained their growth with average loan volumes of corporate, consumer and SME increasing by 20 percent, 18 percent and 30 percent, respectively.
Loans for small and medium enterprises comprised 12 percent of the bank’s total loan portfolio as planned. Meanwhile, micro-finance lending through Rizal Microbank sustained its climb with outstanding loan portfolio increasing 46 percent. The interest income from the lending business contributed 83 percent of the total interest income of the bank.
Total deposits stood at P321.9 billion with low-cost CASA (current and savings account) deposit level growing by P16.6 billion to P204.3 billion and leading to a CASA ratio of 63 percent.
Total consolidated assets grew 9 percent to P468.7 billion, while capital funds improved by P16.9 billion to P62.4 billion.
The bank’s distribution network grew to 450 branches in the first half from 439 a year ago, while ATMs increased to 1,208 compared to 1,163 in the same period last year. This resulted in a 2.68 branch-to-ATM ratio, one of the highest in the industry.
The bank’s total number of accounts expanded to 6.9 million for the period from 6.3 million a year ago.