SBC 5-Year Fixed Rate Corporate Bonds

What are the key terms of the Security Bank Bonds (“Bonds”)?

The Bonds are Fixed Rate Bonds that will be issued on October 29, 2025, with a tenor of 5 years and will mature on October 29, 2030 (the “Maturity Date”). The minimum investment amount is PHP500,000 and multiples of PHP100,000 thereafter. The coupon or interest payment will be made quarterly. The Principal investment plus the interest calculated for the last interest period will be paid on the Maturity Date.

What is the interest rate of the Bonds?

The interest rate is 6.00% p.a., gross of 20% FWT and 0.20% p.a. Trust DIMA fees. The effective net return is 4.60% p.a. (net of 20% FWT and 0.20% p.a. Trust DIMA Fees).

For corporate accounts with valid BIR tax exemption certificates, the effective net return is 5.80% p.a.

The term of the Bonds is 5 years. When do I expect interest payment on my investment?

Security Bank, as the Issuer of the Bond, will pay interest quarterly on these dates: 29 January, 29 April, 29 July, and 29 October of each year, with the last interest payment date to coincide with the Maturity Date. If any of these payment dates fall on a non-banking day, the payment will be made on the next banking day without adjustment in interest.

How will my interest be calculated?

1. First, we calculate the interest in your investment using 90/360 days.
   To illustrate: Principal amount of investment: PHP1,000,000.00
   PHP1,000,000.00 x 6.0000% p.a. x 90/360 = PHP15,000.00
2. Next, we calculate the net interest, applying the 20% final withholding tax

   Net interest amount: PHP15,000.00 * (100%-20%) = PHP12,000.00

3. Next, we calculate the Trust fees based on the actual number of days elapsed during the interest payment period/actual number of days in the current calendar year. To illustrate, we will use the information for the first interest payment period of the Bonds:
   
   First interest payment period: October 29, 2025 to January 29, 2025
   Actual number of days: 93 days
   Actual number of days this year 2025: 365
   PHP1,000,000.00 x 0.20% p.a x 93/365 = PHP509.59
4. Then, the final calculation is the final amount of interest, net of fees:
   Net interest amount minus trust fees = PHP12,000-PHP509.59=PHP11,490.41

   
   The amount of PHP11,490.41 will be credited to your nominated Security Bank CASA on the interest payment date.

Can foreigners invest in the Bonds?

Yes, foreigners can invest in the Bonds on condition that the foreigner 1) is a resident of the Philippines; or 2) is a non-resident of the Philippines but engaged in trade or business in the Philippines.  Interest income from this investment will be subject to 20% final withholding taxes.

What will I receive when the SBC Bonds are issued on October 29, 2025?

 You will receive a Confirmation Advice that will reflect the directed investment in the SBC Bonds to include the following information:

• Principal/Face Value of the Investment: The amount confirmed to be invested in SBC Bonds
• Interest Rate: 6.00% p.a.
• Term: 5 years
• Issue Date: October 29, 2025
• Maturity Date: October 29, 2030
• Trust Fee: 0.20% p.a.

Who can I reach out to if I want to sell my investment in the SBC Bonds?

You may reach out to your Wealth Manager or your branch of account. You may also reach out to any of the SBC TAMG’s Sales Officers by emailing [email protected]. As with any bond, this will be subject to prevailing market rate at the time of the pre-termination and the availability of interested buyers. There will also be costs and fees charged by counterparties for pre-termination. The prevailing market rate of the Bond plus the costs and fees will be shared with you when the request for pre-termination is received by SBC TAMG. We will only execute the pre-termination upon your written instruction.

Minimum Risk Profile: Moderate

Clients with at least Moderate risk profile who seek relatively stable returns on investments that are higher than the deposit and/or money market investment products and are open to a medium-term investment horizon. Balanced growth is important for these investors who are able to tolerate investment losses.

Key Considerations:

• Corporate bonds carry a higher risk than deposits and shorter-tenored government and corporate debt instruments, but with better yields.

• A 5-year tenor increases the bond’s sensitivity to interest rate movements. This introduces higher potential price volatility, which Moderate investors are typically willing to accept.

• It aligns well with the investment horizon of Moderate investors, who typically seek medium-term investments with tenors up to 5 years.

• While the principal and interest are expected to be paid on time, Corporate Bonds are not insured, and there may still be limited market risk, especially if the client decides to exit early.

• This risk profile ensures that investors understand and accept the moderate level of risk and volatility in pursuit of stronger returns than lower-risk instruments.

About the DIMA Product

An Investment Management Account (IMA) is when individual or corporate clients ask SBC TAMG to help manage their assets. SBC TAMG, as Agent, does not hold legal title to the assets as it remains with the client. SBC TAMG, as Investment Manager, designs and implements investment strategies suitable to the client’s specific requirements. The disposition of funds may be subject to full discretion of SBC TAMG or on a directional basis.

If your preference is to invest on a directional basis, then a Directional IMA Account or DIMA is the suitable product for you. A DIMA is a type of IMA wherein you, as the client, direct/instruct SBC TAMG on where to invest his/her funds, under specified terms and conditions.

Benefits of a DIMA

• Get Confirmation Advice for each investment made for your DIMA account.
• Receive Quarterly Statements of your outstanding investments in DIMA.
• Consolidate all your investments into a single DIMA account.
• Invest in other securities using the same DIMA account. You only need to send a Letter of Instruction (LOI).
• Invest in equities without opening a stockbrokerage account.
• Receive regular market updates as part of our mailing list.
• Make informed investment decisions using issuer briefs provided by SBC TAMG.
• Stay updated on events that may affect your investments with key information and recommendations from SBC TAMG, when warranted.

About Corporate Bonds and Key Risks

What is a Corporate Bond?

A corporate bond is a type of debt instrument that is issued by a company and sold to investors. An investor who buys a corporate bond is effectively lending money to the company in return for a series of interest or coupon payments. On issue date of the bond, the bond becomes listed in the secondary market where the bond may be bought or sold.

Price Risk when Liquidating your Investment in Bonds

Depending if there is a willing buyer of the bond and the prevailing market price, selling/liquidating your bonds in the secondary market may potentially result in sales proceeds that are lower than the original Principal amount of your investment.

If you should liquidate your investment in bonds at a future date, you may reach out to your branch of account or to your Wealth Manager to request to sell your Bonds in the secondary market.

For additional questions, please email us at [email protected] or reach out to your Wealth Manager or Security Bank branch.

Disclaimer

This content is purely for information only and is not intended to be comprehensive or complete and does not purport to contain all the information that you, a  prospective client and investor (the “Client”) may require or need. The Client should not rely solely on the information provided herein without making independent analysis or research on the prospective investment you may be considering to participate or invest in. This investment content is not in any way intended as a substitute for sound investment or risk management advice. As a prospective client who is considering to invest, you are representing to sbc trust that you possess adequate experience in investing in similar securities and knowledge of the risks attendant thereto. No representation or warranty as to its accuracy, reasonableness or completeness, whether expressed or implied is hereby made by security bank corp. – Trust and Asset Management Group (SBC TAMG). In no case shall this investment content be taken and understood as an active offer or solicitation to invest in the corporate bond as it is was never intended by SBC TAMG to be such. The indicative terms and conditions of this corporate bond offering, the same being a primary offer by the issuer, are herein subject to change by the issuer without prior notice to the client. Security Bank Corp. and its group of companies may have been appointed to act as underwriter/arranger/selling agent or a  party to the issuer, thus, all views in the communication may or may not be similar to that the Bank and its group of companies. Reproduction of this content, whether in whole or in part, is strictly prohibited without prior consent of Security Bank Corp. Security Bank Corp. denies any and all liability that may arise out of any loss which includes, but is not limited to actual, direct or consequential damages due to the client’s reliance on any information provided herein that the latter may have taken into consideration in participating or investing in this corporate bond. You admit and acknowledge that you have fully read and understood this disclaimer and agrees and consents to be bound by the terms and conditions herein.