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RCBC pursues $100M equity deal

/ 02:58 AM March 07, 2013

Rizal Commercial Banking Corp. is continuing its capital build-up program by selling at least $100 million worth of equity through a top-up offering.

Industry sources told the Inquirer that RCBC was set to conduct Wednesday night a follow-on equity deal as part of its $430-million capital-raising effort to prepare for the stringent capital adequacy requirements under Basel 3.

The bank on Wednesday reported to the Philippine Stock Exchange that Credit Suisse, Deutsche Bank, Macquarie Capital and Maybank ATR Kim Eng Financial Corp. were mandated to arrange the equity deal.


The disclosure said the equity offer would be priced at a minimum of P60 a share. On Wednesday RCBC closed at P67 a share, giving it a market capitalization of P75.9 billion.

Under the top-up offering, RCBC’s controlling shareholder—the Yuchengco group—will sell some of its shares for a quick equity deal but will later subscribe to the same number of shares.

RCBC earlier signed a $100-million equity infusion deal with International Finance Corp. and unveiled plans to issue $130 million worth of Basel 3-compliant hybrid notes by the third quarter. RCBC now only has to raise $200 million more. Industry sources expect RCBC to raise the offer anywhere from $150 million to $200 million in case of strong demand.

RCBC grew its net profit last year by 24 percent to P6.21 billion on higher interest and fee-based income, and hefty treasury gains. This translated to a return on equity of 15.52 percent and a return on assets of 1.77 percent.—Doris C. Dumlao

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TAGS: Banking, capital raising, equities, fund raising, Philippines, Rizal Commercial Banking Corp. (RCBC)
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