China Bank eyes P15 B from stock rights offer

MANILA, Philippines - China Banking Corp. has joined the list of banks beefing up their resources after announcing plans to raise P15 billion through a stock rights offering.

In a disclosure to the Philippine Stock Exchange (PSE), the bank owned by retail and banking magnate Henry Sy said the additional capital would enable the bank to pursue growth strategies.

The bank’s board of directors approved the offering of common shares from the unused portion of the authorized capital to eligible stockholders.

The planned fund raising activity would be subject to the approval of the Bangko Sentral ng Pilipinas (BSP) and other regulatory agencies.

China Bank Capital Corp. would serve as issue manager, joint bookrunner, and domestic underwriter of the proposed stock rights offering.

China Bank president and CEO Ricardo Chua said the fund raising activity would beef up the bank’s funding base to become a more significant player in the industry.

“With a strong foundation, China Bank is in a good position to pursue further its strategic direction of becoming an even more significant player in key market segments and a stronger partner for our customers, as we continue to deliver better returns to our shareholders. This capital raising will give us the ammunition to execute our strategy,” Chua said.

According to him, 2017 marks the 10th anniversary of the acquisition of Manila Bank to become China Bank Savings (CBS).

This was followed by the acquisition of Plantersbank in 2014 and its full integration into CBS in 2015, and return to full year profitability of CBS in 2016.

He added this year also marks the 10th anniversary of Manulife bancassurance partnership after the first full year of China Bank Capital as a subsidiary.

Last November, China Bank raised close to P9.6 billion through the issuance of long-term negotiable certificates of time deposits (LTNCD) to support its strategic initiatives and business expansion marking its return to the peso debt market after its LTNCD transaction in 2008.

Earnings of China Bank jumped 31 percent to P4.84 billion in the first nine months of last year as the bank’s core business drivers continued to show robust growth. It has 526 branches including the 160 branches of CBS nationwide.