AUB maiden bond offer yields P7B

AUB said it issued only P7 billion as it was seen as the “right balance” between its internal funding requirement and investor reach.

Listed lender Asia United Bank successfully sells P7 billion worth of bonds in an inaugural sale targeted to generate only P3 billion. The funds will help underwrite AUB’s corporate activities down the line.

Asia United Bank Corp. (AUB) has secured P7 billion in new funds from its maiden bond issuance, near three times oversubscribed from the initially announced P3 billion offer size.

The listed lender said it plans to utilize the proceeds from the fund-raising for general corporate purposes. The three-year bond has a coupon rate of 4.625.

The bonds were issued and listed with the Philippine Dealing & Exchange Corp. on 7 November.

AUB concluded the offer in two days ahead of its original 30 October schedule due to “overwhelming demand.” AUB said it issued only P7 billion as it was seen as the “right balance” between its internal funding requirement and investor reach.

“We are extremely pleased to have achieved this milestone for our first tranche at a time when competition is very high among bank and corporate issuers crowding the market for investment funds,” AUB executive vice president and head of treasury Antonio Agacoili was quoted as saying in a filing to the stock exchange on Monday.

“Though we had to work within a tight timetable, the positive response we received is proof that AUB has attained a new level of customer preference that believe in our financial strength and operational capabilities in a highly competitive market environment,” he added.

According to AUB, it conducted the subscription process for the transaction using a fully digital platform, making it the first issuer to do so.

China Bank Capital Corp. and First Metro Investment Corp. served as joint lead arrangers for the offering, while Amalgated Investment Bancorporation acted as selling agent together with AUB.

AUB and its units registered 63 percent higher net income in the first half of the year, to P2.6 billion on the back of securities trading and loan growth.