The Philippine Business Bank (PBB)
IPO Amount: P4.01 billion
Shares issued: 101,333,400 common shares
IPO Price: P31.50 (final update)
offer period: February 6
listing date : February 19
Underwriters: First Metro Investment Corp. and SB Capital Investment Corp.
Financial advisor and issue manager : Asian Alliance Investment Corp.
THE Philippine Business Bank is thrift bank owned by former envoy Alfredo Yao. They plan to use the proceeds to pay for bank-branch licenses, expand its branch network, implement information-technology (IT) projects, and acquire assets. About P400 million will be allocated to fund their capital-expenditure requirements. Some funds will also be allocated to retire debts.
The PBB will invest P50 million in opening branches in the cities of Makati, Mandaluyong, Pasay, Pasig and Quezon within the first quarter of 2013. It will also invest another P50 million to open branches in the cities of Caloocan and Marikina, as well as Pateros town; Zamboanga City; Tuguegarao City, Cagayan province; Cauayan City, Isabela province; Butuan City, Agusan del Norte province; Tagum City, Davao del Norte province; Tacloban City, Leyte province; and Kalibo town, Aklan province within the second and third quarters of the year.
The bank estimates that it would invest P100 million in improving its IT infrastructure system, such as its current account and savings account/general ledger, treasury and loan-management systems, as well as in upgrading its servers, in the fourth quarter.
The PBB will also spend P200 million to acquire branch licenses in the cities of Caloocan, Malabon, Navotas and Valenzuela; central and southern Luzon; the Visayas; and Mindanao in the same quarter.
It will invest the net proceeds in short-term demand deposits and money market placements.
The PBB clarified that these proceeds will be used to repay outstanding obligations to the joint lead underwriters or issue manager, as well as to reimburse any officer, director, employee or shareholder for services rendered, assets previously transferred, or money loaned or advanced.
As of September 30, 2012, the PBB has 72 branches in strategic business, commercial and industrial areas in Metro Manila and in key urban locations in various provinces that cater to small and medium enterprises.
The bank has 13 unfulfilled branch licenses: nine for Metro Manila and the rest for provincial branches.
In the first nine months of 2012, the PBB posted a net income of P624.10 million from P549.2 million in the same period the year before. The bank’s assets and liabilities are valued at P29.66 billion in the first nine months of 2012, from P23.97 billion in the same period the year before.
The PBB’s interest income dropped by 1.71 percent to P1.24 billion in the first nine months of 2012 from P1.26 billion in the same period the year before due to lower interest income from investment securities that decreased to P268.81 million from P460.69 million.
Interested investors must purchase at least 500 shares, which may be increased by increments of 100 shares, thereafter.
After the IPO, the bank will have an estimated public float level of 30%, higher than the Philippine Stock Exchange’s (PSE) 10% minimum requirement.
Mr. Yao and the beverage firm he founded, Zest-O Corp., will remain as the bank’s majority shareholders, respectively owning 37% and 25% of PBB after the IPO.