BPI successfully prices USD 400 Mn 5-Year Reg S Senior Unsecured Notes Offering

On Tuesday, March 19, 2024, Bank of the Philippine Islands (“BPI”) successfully tapped the international capital markets with a public USD bond issuance for the first time since 2019, with its offering of USD 400 Mn 5-year Reg S senior unsecured notes (“Notes”).

The Notes were issued under BPI’s USD 3 Bn Medium Term Notes Programme, and the net proceeds will be used for refinancing and general corporate purposes.

The 5-year Notes were priced at U.S. Treasury spread of T+105 basis points (bps) with a coupon of 5.25%, representing the tightest ever spread on a 5-year bond from a non-sovereign Philippine issuer, adding another milestone to BPI’s long list of achievements.

The Notes are rated Baa2 by Moody’s. *

The transaction is expected to settle on March 26, 2024.

BPI announced the transaction mandate on Monday, March 18, 2024 and conducted a comprehensive investor marketing exercise involving a global investor call and a series of meetings covering investors across Hong Kong, Singapore, and London. After receiving positive investor feedback, BPI proceeded to launch the transaction bookbuilding on Tuesday, March 19, 2024, with an Initial Pricing Guidance (“IPG”) of T+140 bps area. Orderbooks saw strong momentum throughout the day, despite a week rife with global central bank policy meetings, with the final books standing at over US$1.3 billion, as the Notes were 3.3 times oversubscribed. This allowed 35 bps of pricing compression from IPG to final pricing, even as the issue size was increased from the original indications of US$300 million, to accommodate the strong oversubscription levels.

In terms of geographic allocation, the Notes were distributed 81% to Asia and 19% to EMEA / Offshore U.S. accounts. The Notes were distributed to high quality fixed income accounts: 51% to Fund Managers, 29% to Banks, 17% to Private Banks and Financial Institutions, and 3% to Insurance.

BPI Capital was the Sole Global Coordinator, while J.P. Morgan, Mizuho, Standard Chartered Bank and UBS were the Joint Lead Managers for the transaction.

*A rating is not a recommendation to buy, sell or hold the securities and may be subject to suspension, reduction, or withdrawal at any time by the rating agency.

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The securities referred to herein will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any state of the United States or any other jurisdiction. Any securities as referred to herein will only be offered and sold outside the United States in reliance on Regulation S under the Securities Act and may not be offered or sold within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state or local securities laws. No public offering of any securities referred to herein will be made in the United States or in any other jurisdiction where such an offering is restricted or prohibited.

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THE NOTES ARE EXEMPT FROM REGISTRATION PURSUANT TO SUBSECTION 9.1(E) OF THE SECURITIES REGULATION CODE OF THE PHILIPPINES (THE “SRC”). THE NOTES HAVE NOT BEEN AND WILL NOT BE REGISTERED WITH THE PHILIPPINE SECURITIES AND EXCHANGE COMMISSION (“PHILIPPINE SEC”) UNDER THE PHILIPPINE SRC AND ITS IMPLEMENTING REGULATIONS. ANY FUTURE OFFER OR SALE OF THE NOTES WITHIN THE PHILIPPINES IS SUBJECT TO THE REGISTRATION REQUIREMENTS UNDER THE SRC UNLESS SUCH OFFER OR SALE IS MADE UNDER CIRCUMSTANCES IN WHICH THE NOTES QUALIFY AS EXEMPT SECURITIES OR THE OFFER QUALIFIES AS AN EXEMPT TRANSACTION UNDER THE SRC. THE OFFER, SALE AND PURCHASE OF THE NOTES ARE SUBJECT TO APPLICABLE REGULATIONS OF THE BANGKO SENTRAL NG PILIPINAS AND THE PHILIPPINE SEC.