Chinabank going for P8-B stocks right offer to meet Basel III, corporate requirements

China Banking Corp. plans to raise up to P8 billion through a stock rights offering for corporate expansion and meet the Basel III requirements.

 

The Chinabank board approved the capital raising exercise – by offering common shares to certain eligible shareholders, the bank said in a disclosure to the Philippine Stock Exchange Thursday.

 

The bank expects to raise up to P8 billion from the offering, which will be used to expand and maintain compliance with the Basel III requirements, particularly in light of the recent acquisition of Planters Development Bank.

 

In line with the capital raising activity, Chinabank is infusing P800 million in China Bank Savings Inc. (CBSI), the bank said in a separate disclosure.

 

The offering is subject to regulatory approvals, Chinabank said.

 

The capital infusion will be done in "tranches as may be considered necessary to support CBSI's planned business growth and expansion, and to enable CBSI to meet the minimum capital requirement under Basel III."

 

On January 16, Chinabank paid majority shareholders of Planters Development Bank P1.579 billion to complete the takeover and turned Plantersbank into a subsidiary. 

 

"The bank’s core strategy is aimed at expanding its market position by growing risk-weighted assets with a focus on the SME and consumer segments while also extending the depth and breadth of its retail distribution," the disclosure read.

 

The bank said the offering will help increase Chinabank's visibility within the investing community and impact on the trading liquidity of its shares on the Philippine Stock Exchange.

 

The board also approved the appointment of Citigroup and J.P. Morgan as joint global coordinators, joint lead managers and underwriters for the issuance. – Danessa Rivera/VS, GMA News