Yuchengco-led RCBC to raise P5B from stock rights offering
MANILA, Philippines – The Philippine Stock Exchange (PSE) has approved the planned stock rights offering of the Yuchengco-led Rizal Commercial Banking Corporation (RCBC).
The bank previously said that it expects to raise proceeds of up to P4.5 billion ($99.96 million*) from the rights offering.
Under the plan, RCBC will offer 124.341 million common shares, entitling eligible shareholders to subscribe to 1 right share for every 11 shares owned as of record date October 16.
The offer price will be determined based on the 10-day volume weighted average price of the bank’s shares on the PSE subject to a maximum discount of 20%.
Share price of RCBC closed at P53.60 ($1.19*) per share on September 26.
Final price will be set on October 8 while the offer period will be from October 24 to 30. The shares will be listed on November 10.
The proposed rights offer will also allow RCBC to strengthen its capital ratios under the Basel III standards to support its asset growth.
Basel III is part of the continuous effort made by the Basel Committee on Banking Supervision to enhance the banking regulatory framework; improve the banking sector's ability to deal with financial and economic stress; improve risk management; and strengthen the banks' transparency.
In August, it was reported that Cathay Financial Holding Co. of Taiwan has offered RCBC a price of P64 ($1.42) per share to purchase about 20% to 30% stake in the bank.
Also in August, RCBC raised P3 billion ($66.56 million) when it reopened Tier 2 notes due 2024. Tier 2 notes are a debt security issue used to provide a firm with supplementary capital.
As of June 30, 2014, RCBC was the 6th largest private domestic commercial bank in the country in terms of total assets.
RCBC is a member of the Yuchengco Group of Companies, one of the oldest and largest conglomerates in the Philippines and Southeast Asia. – Rappler.com
($1 = P45.07)