EastWest Bank planning to raise P1.2B for expansion

MANILA, Philippines - EastWest Banking Corp., the financial services unit of Filinvest Development Corp. (FDC), plans to raise P1.2 billion through the issuance of Tier 2 capital to finance its expansion. In a talk with reporters, FDC Chairman Jonathan T. Gotianun said the proceeds could be used to add 10 more branches to its present 77. "We do not have the timeframe yet for the offer," Mr. Gotianun said at the sidelines of FDC’s stockholders meeting Friday. He added that the capital-raising activity would also strengthen its capital adequacy ratio (CAR) which was at 13% as of May. Banks are required to maintain CAR — which is the measurement of its capability to meet liabilities and risks — at at least 10%. Mr. Gotianun said the listing EastWest Bank on the local stock exchange could take place within the next few years. "We’re keeping our eyes open whether it will fit," he said. In 2007, EastWest Bank posted a net income of P137 million as interest income grew by 16% to P2.5 billion. It has a total of 75 automated teller machines (ATM) with a customer base of over 200,000. Aside from financial services, FDC also has businesses in sugar manufacturing and real estate development. - Lovely Nica P. Lee, BusinessWorld