MANILA, Philippines—Chinatrust Commercial Bank (Philippines) Inc. obtained shareholders’ approval on Thursday to delist from the Philippine Stock Exchange and make an offer to redeem shares held by minority investors at P26.14 per share.
In an interview, Chinatrust chief finance officer Andre Payawal said that taking the commercial bank back to private hands precluded earlier plans for it to become a universal bank.
This, even as the bank – a subsidiary of Taiwan’s largest bank Chinatrust Commercial Bank – earlier obtained approval from the Bangko Sentral ng Pilipinas to upgrade into universal banking subject to certain requirements, including having a public float of at least 10 percent.
“The bank believes that we have quite a strong capital position and that we can still pursue our strategic objectives without being a publicly listed entity,” Payawal said.
The tender offer will cover about 1.5 million common shares, suggesting that the bank would redeem about P39.21 million worth of outstanding shares.
The PSE’s tightening of rules on companies below the 10-percent minimum public float, Payawal said, had given the bank the opportunity to evaluate its long-term direction.
With a more simplified ownership structure and strong parent bank support, Chinatrust can now expect to “execute its growth strategies faster and focus its resources and attention toward strengthening its foothold in its chosen markets, paying particular attention to improving profitability through efficient processes and channels, mitigating risk and leveraging on the benefits of its global network.”
According to Chinatrust Philippines president Mark Chen, the intended acquisition of the remaining market float would also give the parent bank better flexibility in coordinating resources across all its subsidiaries “to create operational synergy, implement growth strategies, and strengthen brand value.”
Opened as a full-service commercial Bank in the latter part of 1995, Chinatrust Philippines has one of the largest branch networks among foreign banks in the country.