RCBC boosts capital to P24 B

MANILA, Philippines — Rizal Commercial Banking Corp. (RCBC) is raising its authorized capital by 86 percent to allow the country’s 10th largest bank to issue shares for future fund raising activities.

In a disclosure to the Philippine Stock Exchange (PSE), RCBC said its board of directors approved the increase in authorized capital stock to P24 billion composed of 2.4 billion common shares with a par value of P10 per share from the current P1.4 billion consisting of 1.4 billion shares at P10 per share.

RCBC is set to hold a special stockholders’ meeting on Jan. 29 for the approval of the proposed increase in its authorized capital and the corresponding amendment to the bank’s articles of incorporation.

The Yuchengco-led bank has outstanding shares of 1.399 billion all of which have been issued.

Several banks including BDO Unibank Inc. and China Banking Corp. of retail and banking magnate Henry Sy as well as Ayala-led Bank of the Philippine Islands (BPI) have been rumored to be acquiring RCBC since the death of its founder last April.

The banks denied there were ongoing negotiations.

Earnings of RCBC slipped 2.8 percent to P3.4 billion in the first nine months from P3.5 billion in the same period last year despite the bank’s strong performance in the third quarter.

For the third quarter alone, RCBC’s earnings grew 19 percent to P1.1 billion from P893 million in the same period last year. The bank’s net interest income grew 19 percent from July to September while fee-based earnings rose 14 percent.

RCBC pursued the expansion of its distribution network by selectively opening 26 branches and deploying 64 ATMs mainly in support of its on-going strategy to broaden customer reach and enhance banking convenience.  This brought the consolidated network to 503 branches and 1,539 ATMs, resulting in a 3.06 branch-to-ATM ratio, one of the highest in the industry.

The bank’s resources expanded to P524.4 billion while its capital funds stood at P65.1 billion and well above the minimum regulatory requirement with a capital adequacy ratio of 15.51 percent and common equity Tier 1 ratio of 12.43 percent.