FMIC lines up P140-B debt, equity deals

By Neil Jerome C. Morales, The Philippine Star

Posted at Jan 07 2014 08:09 AM | Updated as of Jan 07 2014 04:09 PM

MANILA, Philippines - The Metrobank Group’s First Metro Investment Corp. (FMIC) is facilitating as much as P140 billion in equity and debt deals this year for various local firms.

Raising funds through bonds and loans are currently preferred by local companies given the volatility in the stock market, a FMIC official said.

“We expect the momentum (of fundraising) to continue this year,” FMIC senior vice president Justino Juan R. Ocampo told reporters.

Specifically, Metrobank’s investment banking arm is looking to close P50 billion worth of debt deals, P60 billion of project financing and P15-30 billion of initial public offerings (IPOs).

“For bonds, we are looking at P50 billion this quarter,” Ocampo said. The deals include JG Summit Holdings Inc.’s P30-billion bond offering, P10 billion for Filinvest Development Corp., and P7 billion for Manila North Tollways Corp.

“Corporates are expected to accelerate tapping the bonds market especially in the first half for pre-funding and will take advantage of the relatively low rates,” Ocampo said.

On project financing, FMIC is arranging P60 billion loans for three power producers, two of which are listed in the local bourse, Ocampo said.

FMIC is also facilitating the debut of several consumer and property-related firms in the local stock exchange. The companies aim to raise around P15-30 billion in fresh capital despite the stock market volatility.

“The situation with respect to liquidity in the system remains,” Ocampo said. However, companies are prioritizing bonds and loans over equities given dampened share prices.

The capital market for debts remain strong due to low interest rates, favorably long maturities and banks’ preference to invest in corporate bonds.

In 2013, total debt issuances in the country dropped 20 percent to P795 billion from P992 billion in 2012 while total capital raised in the equities market fell by a fifth to P175 billion from P219 billion, FMIC data showed.

FMIC was the top arranger for corporate fundraising last year, followed by HSBC, Bank of the Philippine Islands, Standard Chartered and BDO Unibank Inc.