By Eileen A. Mencias

Rizal Commercial Banking Corp., controlled by the Yuchengco group, plans to issue P4 billion in tier 2 notes again with a maturity of 10 years, the bank said in a disclosure to the stock exchange yesterday.

RCBC issued tier 2 notes in February last year, raising P7 billion to refinance notes that matured in July. RCBC in March 2007 raised close to P5 billion in fresh equity when it reissued new shares to fund its expansion.

RCBC bought one savings bank, Merchants Bank, in 2007 for P520 million.

The global financial meltdown has affected RCBC?s performance. RCBC reported a 20-percent drop in consolidated net income in the first nine months of 2008 to P2 billion from P2.5 billion a year ago.

RCBC was among the banks with exposure to Lehman Brothers, which collapsed in mid-September.

The Yuchengcos were also among the first to express interest in buying Philam Life from the American Insurance Group.

RCBC said its core business grew despite a slowing economy and lower profits. It registered an 88-percent increase in foreign exchange gains in the third quarter from a year ago. The bank also reported a 6 percent increase in commissions and fees during the period and a 20-percent growth in trust fees.

RCBC?s consolidated assets expanded 9.7 percent to P248.3 billion as it increased its net loans and receivables by 20.5 percent to P129.7 billion. Consumer loans grew by 20.8 percent to P28.6 billion despite the pessimism among consumers.

RCBC showed an improvement in asset quality after bringing down its bad loans ratio to 3.9 percent at the end of September from 6.6 percent on year.

Deposits grew 13.6 percent to P179.7 billion due to the expansion of its branch and ATM networks, activation of new and improved electronic banking channels and the introduction of new retail banking products that increased low-cost funds by 17.4 percent.