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Investor PresentationLong Term Negotiable Certificates of Time Deposit (CDs)

17-19 October 2017

Disclaimer

2

This presentation is for information purposes only and does not constitute or form part of and should not be construed as, an offer to sell or issue or the solicitation or recommendation of an offer to buy or acquire

securities of Security Bank Corporation (the "Bank", “Company”, “Security Bank” or “Issuer”) or any of its subsidiaries or affiliates in any jurisdiction or an inducement to enter into investment activity. No part of this

presentation, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. The Hongkong and Shanghai Banking Corporation

Limited and Standard Chartered Bank (the “Joint Lead Arrangers”) do not warrant the completeness or accuracy of the information contained herein, nor have they independently verified such information. No

representation, warranty or undertaking, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or the opinions contained herein.

None of the Issuer, the Joint Lead Arrangers, or any of their affiliates, advisors, representatives, shareholders, directors, officers or employees shall have any liability whatsoever (in negligence or otherwise) for any loss

howsoever arising from any use of this presentation or its contents or otherwise arising in connection with the presentation. This presentation is highly confidential and being given solely for your information and for your

use and may not be shared, copied, reproduced or redistributed to any other person in any manner.

Any securities, financial instruments or strategies mentioned herein may not be suitable for all investors. Any recipient of this presentation must make its own independent decision regarding any securities or financial

instruments. Any decision to purchase securities in the context of a proposed offering of securities, if any, should be made solely on the basis of information contained in an offering circular or prospectus published in

relation to such an offering. Investment in the securities will also involve certain risks. A summary of the material risks relating to the Offering will set out in the section headed Risk Factors / Investment Consideration in the

offering circular or prospectus. There may be additional material risks that are currently not considered to be material or of which the Company and its advisors or representatives are unaware. This document contains

"forward-looking statements", which include all statements other than statements of historical facts, including, without limitation, any statements preceded by, followed by or that include the words "targets", "believes",

"expects", "aims", "intends", "will", "may", "anticipates", "would", "could" or similar expressions or the negative thereof. Such forward-looking statements involve known and unknown risks, uncertainties and other important

factors beyond the Issuer's control that could cause the actual results, performance or achievements of the Issuer to be materially and adversely different from future results, performance or achievements expressed or

implied by such forward-looking, including, among others, the achievement of anticipated levels of profitability, growth, cost and synergy of recent acquisitions, the impact of competitive pricing, the ability to obtain

necessary regulatory approvals and licenses, the impact of developments in the economic, political and legal environment of the Philippines, volatility in stock markets or in the price of the Issuer’s shares, financial risk

management and the impact of general business and global economic conditions.

Such forward-looking statements are based on numerous assumptions regarding the Issuer's present and future business strategies and the environment in which the Issuer will operate in the future. By their nature,

forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. These forward-looking statements speak only as at the date

as of which they are made, and the Issuer expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the Issuer's

expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based. Forward-looking statements contained in this presentation regarding past trends or activities

should not be taken as a representation that such trends or activities will continue in the future. You should not place undue reliance on such forward-looking statements.

This presentation contains data sourced from and the views of independent third parties. In replicating such data in this presentation, the Issuer makes no representation, whether express or implied, as to the accuracy of

such data. The replication of any views in this document should be not treated as an indication that the Issuer agrees with or concurs with such views.

Neither the Issuer, nor any of its agents, employees or advisors intends or has any duty or obligation to supplement, amend, update or revise any of the forward-looking statements contained in this document.

The Joint Lead Arrangers may act as market maker or trade on a principal basis, or have undertaken or may undertake to trade for their own account, transactions in the financial instruments or related instruments of the

Issuer and may act as underwriter, placement agent, advisor or lender to Issuer. The Joint Lead Arrangers and/or their employees may hold a position in any securities or financial instrument.

The information contained in this presentation is provided as at the date of this document and is subject to change without notice.

You acknowledge that you will be solely responsible for your own assessment of the market and the market position of the Company, and that you will conduct your own analysis and be solely responsible for forming your

own view of the potential future performance of the business of the Company. Any decision to purchase securities in the context of a proposed offering of any securities, if any, should be made solely on the basis of

information contained in an offering circular or prospectus published in relation to such an offering. By accepting to access any copy of the slides presented, you agree to be bound by the foregoing limitations.

A written copy of the preliminary prospectus may be obtained from: the Issuer or any of the Joint Lead Arrangers.

The information contained in this presentation is subject to BSP Circular Nos. 877 (2015), 830 (2014), 824 (2014), 810 (2013), 778 (2012) and 304 (2001) and Sections X233.9 of the Manual of Regulations for Banks (“MORB”),

and other related issuances of the BSP which govern the issuance of Long Term Certificates of Time Deposit.

THIS DOCUMENT AND THE INFORMATION CONTAINED HEREIN DOES NOT CONSTITUTE AN OFFER TO PURCHASE OR SELL ANY SECURITIES OF THE COMPANY.

Table of Contents

3

Overview of Security Bank

Investment Highlights

Product Guide: LTNCD Overview

Indicative Terms of Offering and Timeline

1

2

3

4

Q & A6

Offer Procedures and Other Considerations5

Table of Contents

4





1

2

3

4

Q & A6

Offer Procedures5

5

Security Bank Overview

Security Bank is an independent bank in the Philippines with core businesses in Wholesale

Banking, Retail Banking and Financial Markets, with a solid niche among the mass affluent

Filipino-Chinese community

Financial

Markets

Wholesale

Banking

Retail

Banking

• Provides money market, FX, financial derivatives, securities distribution,

asset management and trust services, as well as the management of the

funding operations of the Group

• Provides a whole suite of financial products & services to the top 1,000

corporate, institutional, commercial, middle-market/SME and public

sector markets

• Caters to to individual and retail markets. It covers deposit-taking and

servicing, consumer loans and credit card facilities

Return on Equity

10.6%(1)

5h in industry(2)

Note:

(1) As of June 30, 2017; (2) Industry pertains to listed private domestic universal banks in the Philippines

Total Assets

PHP774.7 bn(1)

5th in industry(2)

Loan Portfolio

PHP340.2 bn(1)

6th in industry(2)

Capital Ratios(1)

Tier 1 Ratio: 16.6%

Total CAR: 18.9%

Security Bank Overview (cont’d)

6Note:

(1) As of June 30, 2017

(2) Rating date started as of October 26, 2016.

170 Branches | 57%

73 Branches | 25%

26 Branches | 9%

25 Branches | 9%

LUZON

VISAYAS

METRO MANILA

MINDANAO

Branches (1) ATMs (1)

294 657

Nationwide FootprintKey Subsidiaries and Affiliates

99.54% owned

(formerly Security Bank Savings)

Will be engaged as a financing

company

100% owned

Pioneer in the Philippine credit

card industry

100% owned

Provides investment banking and

financial services

100% owned through SB

Capital

One of the top domestic stock

brokerages in the country

100% owned through SB

Capital

Incorporated in Jan 2014,

engaging in the business of

renting and leasing

60% owned

JV with Japan’s Marubeni

Corporation

Specializes in heavy equipment

leasing

2015 2016 H1-2017

Moody’s (2)

Standard & Poor’s

Capital Intelligence

-

BB+

BBB-

Baa2

BB+

BBB-

Baa2

BB+

BBB

Credit Ratings

Track Record of Excellence

2015

Best Managed Mid-Cap Company, Philippines,

Best in Investor RelationsOverall Best Company for

Corporate Governance

2015 2015

7

2017 2017

2012

Bank of the Year, Philippines

2015

2015

2016

Highly Commended: Best Bancassurance

2016


2016

Best Bank in the Philippines

2013

Best Managed Bank, Philippines

2017

Best e-Bank Philippines

2017

Kapatiran sa Industriya Awards by Employers Confederation

of the Philippines (ECOP):

Special Citation Award on Industrial Peace &

Harmony

Best Bank for SMEs, Philippines

Most Organized Investor Relations,

Strongest Adherence to Corporate Governance,

Most Consistent Dividend Policy,

Best Strategic Corporate Social Responsibility

Best CEO (Investor Relations) – Philippines,Best Investor Relations

Company ,Best Corporate Social

Responsibility

Best Branch Innovation Initiative, Philippines

Best Improved Retail Bank (APAC),

Best Brand Initiative, Best Mortgage Product

2017

Asia’s Best CEO (Investor Relations),

Asia’s Best CFO (Investor Relations),

Best Investor Relations Company-Philippines


2014

eSolutions Partner Bank (PH) – DigiBanker,

Best Cash Management Solution

(PH) – Sweep Card

2017

Best Bank in the Philippines

2017

Best Managed Company,

Philippines (Mid-Cap),Best Executive, Philippines

(Alberto S. Villarosa, Chairman),

Best for Investor Relations, Philippines

Table of Contents

8





1

2

3

4

Q & A6

Offer Procedures5


9

Stable Funding

Sources and

Pro-Active Capital

Management

2

Core Franchise

Strength

1

Strong,

Experienced

Management

Team

4

Strategy for

Sustainable

Growth

5

Industry Leading

Asset Quality

3

10

Core Franchise Strength

Total Assets Loan and Receivables – net

1

Security Bank has posted continuous growth in total assets and in its loan portfolio…

Amounts in PHP billions Amounts in PHP billions

215259

348

397

532

695

775

'11 '12 '13 '14 '15 '16 H1-'17

92120

165194

238

290

340

'11 '12 '13 '14 '15 '16 H1-'17

11

Core Franchise Strength

Total Deposits Total Capital

1

… supported by continuous growth in deposits as well as in total capital

119142

206247

290

347380

'11 '12 '13 '14 '15 '16 H1-'17

30 37 41 47 5397 101

'11 '12 '13 '14 '15 '16 H1-'17

Amounts in PHP billions Amounts in PHP billions

12

Robust Profitability

Revenues Net Income After Tax

1

Security Bank’s faster-than-industry growth rate has translated into a robust income

profile over the past years

11.6

14.0

12.1

16.6

18.3

20.8

12.2

'11 '12 '13 '14 '15 '16 H1-'17

5,244

6,682

7,516

5,012

7,164 7,699

8,554

'11 '12 '13 '14 '15 '16 H1-'17

Amounts in PHP billions1 Amounts in PHP millions

Note: Revenues are composed of Net Interest Income & Other Operating Income

13

Robust Profitability

Net Interest Margin Return on Shareholders’ Equity

1

Security Bank’s net interest margins and ROE are tracking above the industry-average

4.1

3.9

3.53.4

3.3

3.13.2

3.5

3.3 3.3 3.3

2.9 2.93.0

'11 '12 '13 '14 '15 '16 H1-'17

SECB Industry Avg

24.6

22.0

12.9

16.315.2

10.4 10.612.1 12.7

13.7

11.09.4

10.59.7

'11 '12 '13 '14 '15 '16 H1-'17

SECB Industry Avg (U/KBs only)

Amounts in Percentages (%) Amounts in Percentages (%)

14

Above Industry Growth

Loans and Receivables – net Total Deposits

1

Security Bank has significantly outperformed the industry in terms of loans and deposit

growth in the past six years

Percentage Growth (%) Percentage Growth (%)

8%

19%

45%

20%

17%20%

6%

10%

36%

12%

8%

14%

2011 2012 2013 2014 2015 2016

SBC Universal Banks (UBs)

2011 – 16 CAGR:

SBC: 23%

UBs: 15%

23%

30%

38%

34%

22%

19%

19%

15%

19%

15%

21%

19%

2011 2012 2013 2014 2015 2016

SBC Universal Banks (UBs)

2011 – 16 CAGR:

SBC: 21%

UBs: 14%

Diversified Income Base1

Security Bank has a diversified income base with an increasing focus on core net

interest income

Revenues

Note: Fees and Other Income is composed of fees from trust operations, deposits, loans, advisory, credit cards

and stock brokerage 15

7.5 8.1 8.4

11.112.4

15.9

9.3

1.7

4.12.2

3.62.8

1.8

1.12.4

1.8

1.5

1.93.1

3.2

1.8

11.6

14.0

12.1

16.6

18.3

20.8

12.2

'11 '12 '13 '14 '15 '16 H1-'17

Net Int. Income Trading Gains Fees & Other Income

Amounts in PHP billions

16

Loan Portfolio1

Well diversified loan portfolio supports asset growth

Loan Portfolio by Client Group Loan Portfolio by Industry (1)

55 7195 103

122143

17333

42

6277

92

107

119

4

7

8

14

24

39

46

92

120

165

194

238

289

340

'11 '12 '13 '14 '15 '16 H1-'17

Corporate Middle Market Consumer

51% 50%

37%

13%

53%

40%

7%

57%

38%

5%

59%

36%

6%

60%

36%

4%

39%

10%

51%

35%

14%

Manufacturing

11%

Wholesale/

Retail Trade

18%

Utilities

19%

Real Estate

13%

Financial

Intermediation

9%

Others

30%

TOTAL LOANS:

PHP340 billion

Amounts in PHP billions Amounts in Percentages (%)

Note: (1) as of June 30, 2017

17

Stable Funding Sources and Robust Capital Ratios

Funding Sources

2

Security Bank’s funding is anchored by a sizable deposit base consisting of low-cost current

and savings accounts (CASA). The Bank’s capital ratios are comfortably above BSP standards

Note: (1) SECB’s 2014 and 2015 CARs are Basel 3. Previous years’ CARs are Basel 2. Basel 3 was implemented in Q1-’14.

Note that SECB’s CET 1 ratio is same as Tier 1 CAR

23%32% 29% 27% 27%

18% 18%

15%

15% 16%15% 15%

12%13%

13%

10% 14%

10% 10%

13% 17%

4%3%

3%

2% 2%1% 1%

25%26% 20%

28% 28%27% 33%

3% 3% 2% 2%1%0% 2% 2% 1%

1%15%

12% 12% 10% 10% 13% 13%

4% 3% 3% 5% 5% 2% 2%

'11 '12 '13 '14 '15 '16 H1-'17

Savings Deposits Demand Deposits Time DepositsLTNCDs Bills Payable & Repos Notes PayableSubordinated Debt Capital Other Liabilities

Amounts in percentages (%)

18.2

14.7 15.114.3

12.2

18.0

16.6

20.3

16.315.5

18.4

15.2

20.5

18.9

'11 '12 '13 '14 '15 '16 H1-'17

CET1 CAR

Capital Ratios

Amounts in Percentages (%)

BSP Minimum CAR (10.0%)BSP Minimum Tier 1 Ratio (7.5%)

10.0

7.5

18

Stable Funding Sources and Robust Capital Ratios2

16.6

14.9

12.1 12.0

13.2

10.4

12.8

14.014.7

18.9

15.715.2

14.5

16.0

13.7 13.7

15.7 15.5

SECB PNB RCBC UBP MBT EWB BPI BDO CHIB

CET1 CAR

Median CET1 Ratio = 13.2%

Median Total CAR = 15.5%

The Bank is also better capitalized compared to its peers

Capital Ratios of Philippine Banks

Source: Q2-2017 17Q Financial Statements and Published Balance Sheets as of June 30, 2017.

19

Industry Leading Asset Quality3

Amidst robust growth, Security Bank has significantly improved its

asset quality over the years

Note: (1) BSP introduced in January 2013 the Net Non-Performing Loan (Net NPL) Ratio (defined as gross NPLs less specific

allowance for credit losses, over total gross loans) as a complementary measure to computing NPLs.

Non-Performing Loans Ratio

-0.84-0.66

0.110.28

0.14 0.17 0.10

303

209195 200 205 204

220

-45

5

55

105

155

205

255

305

-1

1

'11 '12 '13 '14 '15 '16 H1-'17

NPL Ratio NPL Cover

Amounts in percentages (%)

20

Strong, Experienced Management Team4

Security Bank is helmed by a Board of Directors with significant experience in banking

and financial services

DIANA P. AGUILAR

TAKAYOSHI FUTAE PAUL Y. UNG FREDERICK Y. DY

JAMES JK HUNG TAKAHIRO ONISHI ANASTACIA Y. DYSenior Advisor Independent Director Director Director

Director Director Director

21


Security Bank is helmed by a Board of Directors with significant experience in banking

and financial services

ALBERTO S. VILLAROSA ALFONSO L. SALCEDO PHILIP T. ANG

RAFAEL F. SIMPAO, JR. JOSEPH R. HIGDON JOEL RAYMOND R. AYSONDirector Independent Director Corporate Secretary

Director Director Independent Director

2222


New Independent Directors as of 25 April 2017

NAPOLEON L. NAZARENO DR. JIKYEONG KANG RAMON R. JIMENEZ JR.

Independent Director Independent Director Independent Director


Strong management leadership consisting of officers with significant experience and

track record in the banking and finance industry

ALFONSO L. SALCEDO, JR. ANASTASIA Y. DY

President &

Chief Executive Officer

Executive Director

Strong, Experienced Management Team (cont’d)4



LESLIE Y. CHAM

Executive Vice President

Branch Banking Group

BELEN C. LIM


Corporate Services Group

JOSELITO E. MAPE


Chief Financial Officer

Strong, Experienced Management Team (cont’d)4



EDUARDO M. OLBES


Wholesale Banking Segment

TAKAHIRO ONISHI


Alliance Segment

RAUL MARTIN A. PEDRO


Treasurer

MA. CRISTINA A. TINGSON


Retail Banking Segment

26

Strategy for Sustainable Growth5

1Be a strong, independent, domestic bank with the global

network of The Bank of Tokyo-Mitsubishi UFJ Ltd , supporting

the growth of key sectors of the economy

2Continue enhancing shareholder value and to regain ROE

leadership among the top private domestic universal banks in

the country

3Build the Retail Banking business as a strong third business

pillar alongside Wholesale Banking and Financial Markets

4Grow the bank’s deposit portfolio, loan portfolio and total

resources to be among the largest in the industry

5Accelerate the bank’s growth and coverage of attractive and

profitable markets through flawless execution, real teamwork across

segments and maximized synergy and collaboration with BTMU

Table of Contents

27





1

2

3

4

Q & A6

Offer Procedures5

28

CD Overview

Unsecured Senior Debt

Senior Debt and Deposits

DEB

T

Unsecured Subordinated

Debt

CDs

CDs are negotiable certificates of time deposit

indicating an amount of indebtedness of a bank with

a designated maturity.

Its minimum features as specified by the Bangko

Sentral ng Pilipinas (BSP) Circular No. 304, as

amended:

Denominated in Philippine Pesos

Minimum maturity of five (5) years

Scripless in form; and

Registered with a third party Registry Bank

maintaining an Electronic Registry Book (ERB).

What are CDs?

Preferred Shares

EQ

UIT

Y

Common Shares

29

CD Overview

Why invest in

CDs?

• Long-term investment/savings• Tax-exemption for qualified individual investors if held for more

than five (5) years• Unlike regular time deposits, they are negotiable instruments• Insured by PDIC up to the maximum coverage per depositor of

PHP500,000 (in aggregate with any existing deposits with the bank)

What are

the key

considerations?

• If sold in the secondary market, the CDs will be subject to price risk, withholding taxes and others fees, as may apply.

• Credit risk of the Issuer

30

CDs vs Alternative Instruments

CD Tier 2 Notes Time Deposit Corporate Bond

Status / Credit Senior Subordinated Senior Senior

Tenor At least 5 years (Typically

5 or 5.5 years)At least 5 years Variable Variable

Pricing Benchmark 5-yr PDST-R2 5-yr PDST-R2 [•] PDST-R2

CouponTypically Fixed

May have rate reset after

5 yearsTypically Fixed Rate Typically Fixed Rate

Minimum Investment

Amount Typically 50,000 PHP 500,000 Variable Typically PHP50,000

Withholding TaxQualified Individuals:

None if held for at least

5 years

Corporates: 20%

Qualified Individuals:

None if held for at least

5 years

Corporates: 20%

20% 20%

PDIC Coverage Yes None Yes None

Listing Requirement Yes No No Yes

Secondary Market

TradingYes – via Broker

Specialists

Yes – via Market

MakersNo Yes

Recent Issuers BDO

RCBC

Metrobank

AUB (2015)

BDO (2014)

RCBC (2014)

Generally all

commercial banks

Vista Land

Double Dragon

Cyberzone Properties

Table of Contents

31





1

2

3

4

Q & A6

Offer Procedures5

Indicative Terms of the Offering

32

Issuer Security Bank Corporation (“SECB” or the “Bank”)

Instrument PHP-denominated, Fixed Rate, Long-Term Negotiable Certificates of

Time Deposit (“CDs”)

Issue Amount Minimum Issue Size of PHP5.0 billion with an oversubscription option

Tenor 5.5 years

Status Direct, Unconditional, Unsecured, and Unsubordinated

At all times ranked pari passu with all other present and future unsecured

and unsubordinated PHP-denominated obligations of the Bank

Issue Date [8 November 2017]

Maturity Date [8 May 2023]

Benchmark [5-year PDST-R2]

Indicative Rate [3.875% area]

Issue Price 100% of the face value

Denomination Denominations of PHP50,000 and increments of PHP10,000 thereafter

Interest Periods Quarterly, 30/360

Governing Law Philippine Law

Listing Philippine Dealing and Exchange Corporation (“PDEx”)

Parties to the Offering

33

Issuer Security Bank Corporation

Joint Lead Arrangers The Hongkong and Shanghai Banking Corporation Limited

Standard Chartered Bank

Selling Agents The Hongkong and Shanghai Banking Corporation Limited

Multinational Investment Bancorporation

Security Bank Corporation

Standard Chartered Bank

Issuer’s Counsel Picazo Buyco Tan Fider & Santos

Arrangers’ Counsel SyCip Salazar Hernandez & Gatmaitan

Registrar and Paying

AgentPhilippine Depository & Trust Corp

Auditor SyCip Gorres Velayo & Company

Important Dates to Remember

34

October 17 Start of Public Offer Period

October 17 – 19 Domestic Roadshow

October [30] End of Public Offer Period

October [30] Deadline for Submission of Documents by Investor

November [8] Issuance of Purchase Advice (PA) to Investors

November [8] Tentative Settlement, Issue, and Listing Date

November [15] Issuance of Registry Confirmations (RC) to Investors

Security Bank reserves the right to close the offer period at an earlier date or amend

the dates of the offering subject to internal discussions with the Joint Lead Arrangers

The Final Interest Rate will be determined during the Public Offer Period

Table of Contents

35





1

2

3

4

Q & A6

Offer Procedures5

Typically, CDs are offered to the general public during the offer period

through the Selling Agents.

Investors who intend to subscribe to the CDs must complete the

Applications to Purchase (ATP) forms and submit the same to the Selling

Agent together with other required documents and the corresponding

payment. Investors will be subject to account opening and “know-your-

customer” procedures of each Selling Agent.

How does an investor participate in the public offer period?

Offering Procedures

36

• The Bank

• Subsidiaries and affiliates of the Bank

• Wholly- or majority-owned or -controlled entities of such subsidiaries and

affiliates of the Bank

• US Persons under the FATCA

• Non-resident aliens not engaged in trade or business in the Philippines

• Non-resident foreign corporations

37

Offering Procedures

Prohibited Holders

The Application to Purchase (ATP) forms will be provided by the

Selling Agents

Investors must complete the ATP and submit this to the Selling

Agent together with required KYC documents and the

corresponding payment

Investors must designate a PHP account, where interest and

redemption of CDs will be credited

Offering Procedures

3

1

2

38

Offering Procedures

39

Information must be entered

in all data fields marked with

an asterisk as required by the

Anti-Money Laundering Act

and related laws and

regulations

DELA CRUZ, JUAN CRUZ 1 JAN 1980 MANILA 123-456-789 FILIPINO

PHP100,000

123 ABC ST. MAKATI CITY 1226 888-0000

Offering Procedures

40

Information must be entered

in all data fields marked with

an asterisk as required by the

Anti-Money Laundering Act

and related laws and

regulations

Offering Procedures

The Registrar will issue the Registry Confirmation (RC) to the

investors and will prepare and maintain the Registry Book6

In the event of oversubscription, the investment amounts will be

reallocated among the investors at the discretion of the Bank and

the Joint Lead Arrangers*4

On Issue Date, Selling Agents will issue a Purchase Advice (PA) to

investors5

*The Joint Lead Arrangers and Selling Agents reserve the right to accept, reject,

scale down or re-allocate any ATP. Payments made whose applications are scaled

down or rejected are returned in proportionate amount or in full.

41

42

Offering Procedures

During offer period End of offer period Allocation

Requirements: Application to Purchase form

Payment

2 Signature cards

Valid IDs

If tax exempt, tax

exempt certificate &

tax undertaking (does not

apply to individuals)

Deadline: Cleared Funds: 10:00AM

on Issue Date

Debit instruction or RTGS:

Close of business of the

end of the offer period

Investors to be informed

at the end of the offer

period or may be even

earlier

Unapplied balance of

deposits made by

investors whose

applications are rejected

or scaled down will be

refunded to them

through their respective

selling agents with no

interest

Secondary sales after the close of the offer period should be coursed through broker

specialists – such sales will be subject to prevailing market rates at the time of the

transaction and applicable brokerage fees

Documentary Requirements

43

Individuals

• Application to Purchase (actual TIN numbers required) 4 originally signed copies

• Signature Cards 2 copies

• Photocopy of valid IDs (photo and signature bearing) 1 current and clear copy

For aliens residing in the Philippines or non-residents engaged in trade or

business in the Philippines

• Consularized proof of tax domicile

1 original copy

Additional documents for Corporate Accounts

• SEC Certificate of Registration, Articles of Incorporation and By-Laws SEC-Certified or Corporate Secretary-Certified True Copy

• Original or Corporate Secretary-Certified True Copy of Duly Notarized Certificate confirming the following: Authorizing the purchase of the CDs

Specifying the authorized signatories and including the specimen signatures

• Documentary proof of investor’s tax exempt status (if applicable) Certified True Copy of the original tax exemption certificate, ruling or opinion issued by the BIR as certified by its

duly authorized officer (issued no more than 1 year prior to subscription)

Original of the duly notarized undertaking declaring and warranting its tax exempt status, undertaking to

immediately notify the Bank and the relevant Selling Agent of any suspension or revocation of its tax exempt status

• Corporate Secretary-Certified list of natural persons who are the beneficial owners of the parent company of

the applicant or the beneficial owners of the applicant down to the individual level

NOTE: For existing clients of the Bank, certain documentary requirements may be waived.

44

Registry Fee Schedule

Transfer Fees in the Secondary Trading

Transfer Fee

PHP100 per side per transfer

Note: If transferring from a registry account to the

depository, the full PHP200 shall be charged to the

transferring holder

Account Opening FeePHP100 per transferee with no existing account in

the Registry

Such transaction fees as PDTC shall prescribe for effecting electronic settlement instructions received from the

PDSClear System if so duly authorized by a holder

Transfer Fees due to Non-Trade Transactions

Transaction Fee PHP100 per side per transfer

Transaction Fee for Non-Intermediated Transfers

(e.g. inheritance, donation, pledge)PHP500 per side plus legal cost

Other Fees charged to the Holder (printing of non-standard reports)

Certification request of holding PHP200 per application

Monthly statement of account

(in addition to the quarterly statement of account to be issued

to each Holder free of charge)

PHP50 per application

Replacement of lost or damaged Registry Confirmations PHP50 per application

Interest income on the CDs will be subject to the following Final Withholding Tax (FWT) rates:

45

Taxation of the CDs (Primary Issuance)

Conditions for Withholding Tax Exemption

Type of Investor Tax Rate

Qualified Individual Holders (if held for at least 5 years) Exempt

Domestic and Resident foreign corporations 20%

Payments to Qualified Individual Holders shall be exempt from income tax, provided the

following are present:

The Holder is an individual citizen (resident or non-resident), a resident alien, a non-

resident alien engaged in trade or business in the Philippines, or an entity that

enjoys tax-exempt status

The CDs’ certificates are under the name of the individual Holders and not under the

name of a corporation or a bank or a trust department/unit of the bank

The CDs are not redeemed prior to the 5th year

In case of transfers, the CD holder shall be liable for the resulting tax due on the entire

interest income earned on the CDs (if any) at graduated tax rates, based on the holding

period of the CDs:

46

Taxation of the CDs (Secondary Market)

Holding Period Tax Rate

Less than three years 20%

Three to less than four years 12%

Four to less than five years 5%

Five or more years Exempt

Payment of the appropriate taxes shall be a pre-condition to effecting the transfer of the

CDs

Table of Contents

47





1

2

3

4

Q & A6

Offer Procedures5

Q&ALong Term Negotiable Certificates of Time Deposit (CDs)

17-19 October 2017

Thank youLong Term Negotiable Certificates of Time Deposit (CDs)

17-19 October 2017

Appendix – Financial SummaryLong Term Negotiable Certificates of Time Deposit (CDs)

17-19 October 2017

Select Income Statement Items (Consolidated Basis)

51

figures in PHP millions 2014 2015 2016 1H2016 1H2017

Interest income 15,374 18,349 22,825 10,664 13,771

Interest expense 4,233 5,950 6,932 3,252 4,471

Net interest income 11,141 12,399 15,894 7,413 9,300

Provision for credit losses 790 628 938 408 242

Net interest income after provision for credit

losses 10,351 11,771 14,956 7,004 9,058

Other operating income 5,446 5,910 4,938 3,372 2,874

Other operating expenses 7,829 9,379 10,463 5,125 5,922

Income before income tax 7,968 8,302 9,431 5,251 6,010

Provision for income tax 821 915 877 399 766

NET INCOME AFTER TAX 7,147 7,387 8,554 4,852 5,244

Select Balance Sheet Items (Consolidated Basis)

52

figures in PHP millions 2014 2015 2016 1H2017

Cash and other cash items 5,620 6,646 7,693 6,555

Due from BSP 35,844 56,882 71,663 53,221

Due from other banks 39,130 31,365 63,944 72,826

Interbank loans receivable and SPURA with the BSP - - 690 1,620

Financial assets at fair value through profit or loss 10,922 2,924 3,389 4,833

Financial assets at fair value through OCI 151 166 178 188

Investment securities at amortized cost 101,485 186,782 245,954 284,623

Loans and receivables 194,004 237,853 289,658 340,215

Other assets 2,301 2,790 3,603 2,043

TOTAL ASSETS 397,198 532,201 694,982 774,699

Select Balance Sheet Items (Consolidated Basis)

53

figures in PHP millions 2014 2015 2016 1H2017

Deposit liabilities 246,813 289,526 346,598 379,673

Financial liabilities at FV through profit or loss 583 735 656 713

Bills payable and SSURA 79,602 150,102 210,878 252,289

Other liabilities 7,582 8,112 7,379 6,952

Total liabilities 349,241 478,986 597,855 673,668

Total equity attributable to equity holders 46,881 53,210 97,122 101,026

Non-controlling interest 1,076 5 5 5

TOTAL LIABILITIES AND EQUITY 397,198 532,201 694,982 774,699

Select Financial Ratios

54

figures in percentages 2014 2015 2016

Return on average equity 16.32% 15.17% 10.37%

Net interest margin 3.37% 3.27% 3.12%

Cost to income ratio 47.42% 51.27% 50.20%

Gross loans to deposits 77,47% 82.05% 83.55%

Core capital ratio 14.26% 12.19% 18.01%

Total capital adequacy ratio 18.38% 15.20% 20.53%

Total equity to total assets 12.07% 10.00% 13.98%

Total NPLs to total gross loans 0.28% 0.14% 0.17%

Recent Issuances of CDs in the Philippines

Issuer Issue DateIssue Size

(PHP mm)Tenor Coupon (%) Spread

BDO Unibank August 2017 11,800 5.5 3.6250% 5Y R2 – 60 bps

Rizal Commercial Savings Bank August 2017 2,502 5.5 3.7500% 5Y R2 – 40 bps

Metrobank July 2017 3,750 7 3.8750% 7Y Benchmark – 60 bps

Robinsons Bank June 2017 4,182 5.5 4.1250% 5Y Benchmark

China Bank June 2017 6.348 5.5 3.6500% 5Y Benchmark – 60 bps

East West Bank May 2017 2.592 5.5 4.0000% 5Y Benchmark – 20 bps

Philippine National Bank Apr 2017 3,765 5.5 3.7500% 5Y Benchmark – 50 bps

East West Bank Mar 2017 3,700 5.5 4.0000% 5Y Benchmark

PS Bank Jan 2017 3,000 5.25 3.5000% 5Y Benchmark – 25 bps

Philippine National Bank Dec 2016 5,380 5.5 3.2500% 5Y Benchmark – 50 bps

China Bank Nov 2016 9,588 5.5 3.2500% 5Y Benchmark – 50 bps

Metrobank Sept 2016 8,650 7 3.5000% 7YR2 + 25 bps

Land Bank of the Philippines Oct 2015 6,000 5.5 3.7500% 5Y R2 + 30 bps

BDO Unibank Apr 2015 7,500 5.5 3.7500% 5Y R2 + 50 bps

Investor PresentationLong Term Negotiable Certificates of Time Deposit (CDs)

17-19 October 2017