The Securities and Exchange Commission (SEC) has approved a two-board structure for publicly listed companies whose shares are traded on the Philippine Stock Exchange, reflecting the rules on capital structure, earnings, and operating history.
A two-board structure, from three, would enhance the criteria for listed companies and those that intend to go public, according to the exchange.
Astro del Castillo, managing director of First Grade Holdings Inc., noted the general definition of a listing board is the system where issues are listed based on asset size, authorized capital and operating history.
Approved by the SEC—as proposed by the exchange—are two listing boards: Small, Medium and Emerging (SME) and Main Board. The new system will replace the First Board, Second Board, and Small and Medium Enterprise Board.
"As we continue to set new milestones for the market, the importance of a more relevant regulatory environment is paramount to spur a growing market," PSE president and chief executive officer Hans B. Sicat noted in an emailed statement Friday.
"The new rules should help raise the profile of publicly listed companies by putting in place requirements that will further show the viability of the companies listing in the Exchange. The new features of these rules should, in the process, also help promote investor protection," Sicat said.
Companies that will list on the Main Board must have an authorized capital stock of at least P500 million and three years of operating history.
Presently, companies listing on the First Board must have an authorized capital stock of P400 million and P100 million on the Second Board.
These companies should have cumulative earnings before income tax, depreciation and amortization (EBITDA) of at least P50 million in the last three years prior to listing on the exchange.
Companies applying for the new SME Board must have an authorized capital stock of at least P100 million, of which a minimum 25 percent must be subscribed and fully paid. — DANESSA RIVERA/VS, GMA News