BANK of the Philippine Islands (BPI) said it obtained approval from the Philippine Stock Exchange (PSE) to conduct a stock rights offering (SRO), with the proceeds to help fund to fund its business expansion.
In a disclosure to the bourse on Friday, BPI said the PSE approved its rights offering to raise up to P50 billion.
The price of the rights shares will be announced on March 27, while the offer will be conducted from April 16 to 25.
The SRO is open to elegible common shareholders of the bank as of April 6.
Ayala Corp. (AC), one of BPI’s principal shareholders, has expressed its support for the rights offering, saying it will exercise it preemptive rights. AC will purchase additional shares prior to the general public offering.
According to BPI, the proceeds from the capital raising exercise will be used to fund the expansion of its loan portfolio particularly in the consumer, small to medium enterprises and microfinance segments.
The proceeds will also finance the expansion of its delivery infrastructure via investments in digitalization as well as additional branches of BPI, BPI Family Bank and BPI Direct BanKo.
BPI Capital Corp. will act as the sole global coordinator and lead manager as well as domestic manager, bookrunner and underwriter, while Deutsche Bank AG Hong Kong branch, Goldman Sachs (Singapore) Pte. and J.P. Morgan Securities will serve as the joint international bookrunners and underwriters.
Aside from BPI, other banks have also announced plans to conduct SROs.
On Wednesday, Metropolitan Banking & Trust Co. said it will offer 799.8 million common shares priced at P75 apiece from March 22 to April 4.
The SRO is expected to raise P60 billion which will also be used to fund loan portfolio expansion as well as to fully acquire its credit card arm Metrobank Card Corp. from ANZ Funds Pty. Ltd.
Meanwhile, Rizal Commercial Banking Corp. plans to raise P15 billion from an SRO. Proceeds will help expand its loan business as well as strengthen capital to Basel 3 standards.
In 2017, BPI booked a net profit of P22.42 billion, up 1.7%, amid net interest income of P48.04 billion.
BPI shares were flat Friday, Mar 16 at P114.7. — Karl Angelo N. Vidal