The Monetary Board of the Bangko Sentral ng Pilipinas (BSP) recently gave EastWest Bank the green light to issue up to P10 billion worth of long-term negotiable certificate of deposits (LTNCD).
The bank is initially offering 5.5-year and 7-year LTNCDs, which will be issued in several tranches this year, to expand its long term deposit base and for general funding purposes.
EastWest remains focused on growing its consumer and mid-market corporate loans, with consumer loans still taking up more than half of total customer loans at 66% as of the third quarter 2016. The bank's loan portfolio has been growing very fast alongside the expansion of its store network-with a compound annual growth rate of 32.9% over the last five years.
"We're raising LTNCDs to expand our long-term deposit base and to support our asset growth plans. This LTNCD offering lengthens the maturity profile of our deposits and at lower reserve cost of 7% versus the usual 20% for regular deposits. It is also an attractive investment outlet for individuals because it is tax-exempt if held to maturity." said EastWest SEVP & Chief Operating Officer Jose Emmanuel Hilado.
The bank had raised a total of P8.1 billion from its previous two LTNCD offerings in 2012-2014.
For the first nine months of 2016, EastWest posted a net income of P2.33 billion, 78% higher year-on-year, on the back of sustained growth in its core business of loans and deposits. The bank attributes its continued growth momentum to its bigger store network, now 445 nationwide to date-the 5th largest in the industry, excluding subsidiaries, and 7th overall, including subsidiaries.