BankCom prepares for P3.5-B public debut

Bank of Commerce (BankCom), the banking arm of the San Miguel conglomerate, has filed an application to raise as much as P3.5 billion from an initial public offering (IPO) by March 2022 to comply with a key requirement to upgrade its license from a regular commercial bank to that of a universal bank.

Based on its registration statement submitted to the Securities and Exchange Commission, BankCom plans to sell up to 280.6 million primary common shares at a maximum price of P12.50 per share. In case of excess demand, it will have the option to increase the offering by 42.09 million shares.

Universal banking license

BDO Capital & Investment Corp., Chinabank Capital, PCCI and PNB are joint issue managers, joint lead underwriters and joint bookrunners for this offering.

The equity deal will bring an additional 20 percent of BankCom’s outstanding shares to public hands, increasing further to 23 percent if the overallotment option is exercised. As 3.7 percent of the company is already currently held by public shareholders, the IPO will allow the bank to end up with a public ownership of 25.9 percent assuming full exercise of the overallotment option.

As of end-June, BankCom ranked as the 16th largest among the country’s roster of 46 commercial and universal banks with an estimated asset base of P181.7 billion.

“BankCom’s IPO is being conducted as part of its universal banking license application. With a universal banking license, the bank will have more opportunities to generate and warehouse interest bearing assets like marketable securities, generate more fee-based income, and manage risk of securities underwritten and held for trading,” the bank said in its prospectus.

The prospectus said BankCom would appoint a stabilizing agent for this IPO. The stabilizing agent will have an option, exercisable in whole or in part within 30 days after listing on the main board, to purchase the option shares at the offer price, on the same terms and conditions as the firm shares. The stabilizing agent, or any person acting on its behalf, may purchase up to 15 percent of the base offer.