"The rating factors in the bank's improving capitalisation and profitability, but remains constrained by the need to meet the minimum capital requirement set by Central Bank by the 2009 financial year end, its high net NPL/equity ratios and concentrations in its credit portfolio."
In terms of priority, the debentures will rank below deposits and all senior debt obligations, but will rank above ordinary and preference shares.
In accordance with Fitch's criteria, the rating assigned to PABC's unsecured subordinate debentures is one notch lower than its National Long-term rating.
The debenture issue will increase PABC's Tier II capital and lengthen the bank's liability maturities, Fitch said.
PABC's loans were extended mainly to small and medium-sized entities, retail customers and to larger corporates.
Loans since the end of the 2006 financial yea