In a disclosure to the Philippine Stock Exchange, iBank said the additional capital will be raised from a debt issue that will further strengthen its capital base and prepare it for faster expansion especially in the event the central bank lifts the moratorium on the issuance of licenses for additional bank branches.
"The strengthened capital base of the bank is likewise expected to enhance its competitive position as it will generate greater confidence in the bank," iBank said.
Tapped as lead manager and sole bookrunner for the issue is Deutsche Bank AG’s (DB) Manila unit.
Tier-2 capital refers to unsecured subordinated debt, undisclosed reserves and loan—loss reserves that do not dilute ownership.
iBank has applied with the Philippine Deposit Insurance Corp. for 50 new branch licenses. It hopes to open five to eight branches a year. It expects to end the year with a total of 80 branches from the existing 74. It recently opened one in Zamboanga.
iBank raised over P1 billion from the initial public offering (IPO) of its shares in 2004. The IPO involved the sale of 62.5 million primary shares equivalent to about 22 percent of the bank’s outstanding shares.
In the past years, iBank had acquired several branches from the PDIC, with Metro Manila branches costing P8 million and provincial branches costing P5 million.
iBank opened as a full-service commercial bank in Sept. 1995. It is now the country’s 20th largest bank in terms of assets and ranked sixth in terms of return on equity among 42 universal and commercial banks.
iBank’s major shareholders include JTKC Equities, iVantage Corp., Razon Industries, Greenhills Properties Inc. and Philippine Realty and Holdings Corp.