Bourse OKs P4.25B IPO plan of Yao group’s bank

The Philippine Stock Exchange has approved an initial public offering worth about P4.25 billion by Philippine Business Bank, setting the stage for the first Philippine stock market debut this year.

PBB, the banking arm of the Zest-O group of businessman Alfredo Yao, is set to offer by next month up to 101.33 million primary common shares for as much as P41.94 per share. This will bring to public hands about 30 percent of the bank’s post-IPO capital.

The offer price is set to be finalized by Feb. 4 while the offer period will run from Feb. 6 to 12. Tentative listing date of the bank’s shares under the ticker “PBB” is Feb 19.

The joint lead underwriters for the issuance are First Metro Investment Corp. and SB Capital Investment Corp. The financial advisor and issue manager is Asian Alliance Investment Corp.

Proceeds from the offering will be used to finance the bank’s lending activities and also to fund the acquisition of investment securities. In addition, about P400 million will cover capital expenditure requirements in connection with its branch network expansion program, including the acquisition of new branch banking licenses, the development and implementation of IT (information technology) infrastructure and applications projects.

“It’s really more as a strategic move to be able to maybe expand business further and then raise funds as an added ammunition. We’re building a war chest for possible acquisition and investments in the horizon of over two to three years if there will be a license upgrade,” PBB president Roland Avante said in an earlier interview.

Yao had earlier said going into universal banking was part of the bank’s long-term thrust.

After the IPO, Yao (with 37.26 percent) and Zest-O Corp. (with 25.17 percent) will remain as the key shareholders of PBB.

PBB is set to hold an investors’ briefing Friday 3 p.m. at Mandarin Hotel to discuss the offering.

The thrift bank has at least 72 branches to date, of which 37 are in Metro Manila where branch expansion is restricted. These branches are positioned in business, commercial and industrial areas particularly those with a critical mass of small and medium enterprises, the bank’s target segment.