UnionBank completes P10 billion stock rights

MANILA, Philippines — Aboitiz-led Union Bank of the Philippines has raised P10 billion via the sale of new shares to existing shareholders to bankroll majority of the projected loan availments as well as other business growth.

In a disclosure to the Philippine Stock Exchange (PSE), the listed bank sold 158.8 million common shares to existing shareholders at P62.97 per share.

Existing shareholders led by Aboitiz Equity Ventures (AEV), the Insular Life Assurance Co. Ltd., and Social Security System (SSS) were entitled to one rights share for every 6.6644 common shares held.

“The bank aims to raise approximately P10 billion through the stock rights offering, which will be used to fund a majority of the projected loan availments from the bank for the remainder of 2018, as well as for general purposes and to fund other business growth,” UnionBank said earlier.

Last October, the bank launched a P70 billion funding program consisting of offshore borrowings as well as domestic borrowings through the stock rights offering, issuance of long term negotiable certificates of deposits (LNTCDs), among others.

UnionBank has so far raised half of its $1 billion medium term note program successfully, tapping $500 million last November.

It raised P3 billion last February from the first tranche of its P20-billion long-term negotiable certificates of time deposits (LTNCDs) offering to improve the bank’s debt maturity profile and help grow its business portfolio.

The Aboitiz-led bank has decided to shift and issue P20 billion worth of bonds or commercial papers as it continues to tap both the onshore and offshore debt markets for fresh funds.

BSP Governor Nestor Espenilla Jr. had said the regulator expects banks to shift to the issuance of bonds and commercial papers instead of LTNCDs in tapping the domestic capital market.