PHILIPPINE Business Bank (PBB) will infuse P10 billion in additional capital to expand its operations, it announced on Friday, which follows its buyout of a rural lender.
In a disclosure to the Philippine Stock Exchange, PBB said its board of directors approved to raise the bank’s authorized capital to P20 billion from the current P10 billion.
Members of the bank board approved the bigger capital stock by adding one billion common shares priced P10 apiece worth P18.7 billion. Meanwhile, preferred shares will remain steady at P1.3 billion.
“PBB is increasing its authorized capital stock in preparation for an enlarged shareholders’ equity base. This will greatly expand the bank’s capability to develop more businesses and harness opportunities in the financial services space,” the listed lender said in the regulatory filing on Friday.
“The increase will enable PBB to meet the growing demands of the banking business.”
The Caloocan City-based lender clarified that the capital infusion will still be subject to approvals of the existing shareholders and state regulators, namely the Bangko Sentral ng Pilipinas (BSP) and the Securities and Exchange Commission.
The bank owned by businessman Alfredo M. Yao recently revealed plans to acquire Insular Savers Bank, Inc., a rural lender with 10 branches in the country. The deal worth P575 million is expected to boost PBB’s retail finance business, and will be completed on or before June 20 this year.
PBB previously said the acquisition will add roughly 10% to its bottom line by offering the rural bank’s microfinance, second-hand auto loan as well as group salary loan products.
The bank operates 144 branches nationwide as of September.
PBB posted a P610.249-million net income for the first nine months of 2018, 38.6% higher than the P440.31 million it made the previous year supported by robust growth in its core businesses.
Shares in PBB went up eight centavos or 0.64% to close at P12.50 apiece on Friday. — Melissa Luz T. Lopez