AG Finance gains slightly in debut

MANILA, Philippines - Microfinance firm AG Finance Inc. became the fourth firm to go public this year as it completes its P150-million initial public offering (IPO) by listing its shares yesterday at the Philippine Stock Exchange.

With an IPO price of P2.18 apiece, its shares closed 0.92 percent higher to P2.20 after trading at P2.12 to P2.24.

AG Finance president Leila Jorge said the company plans to continue its growth trajectory by increasing funds for its niche market.

The microfinance firm will also ensure that stakeholders benefit from more available loans, she added.

“The net proceeds that will be received from the IPO will be used to finance the company’s professional and skilled overseas Filipino workers’ (OFW) loan portfolio expansion program,” AG Finance said.

AG Finance allotted P47 million for OFW loan portfolio expansion and P53 million for loans to professional skilled workers.

AG Finance, incorporated in 2001, is into the microfinance and consumer loans industry targeting Filipinos here and abroad. It provides short term, unsecured credit facilities to permanent rank and file employee of medium-size Philippine firms.

Profits of AG Finance rose seven percent to P43.187 million last year from P40.264 million a year ago, driven by an 11-percent growth in net interest income to P78.55 million from P70.48 million the previous year.

The share sale allowed AG Finance to raise P148.39 million from the sale of 68.07 million common shares.

AG Finance tapped BDO Capital and Investment Corp. as the issue manager and sole underwriter.

The microfinance company braved the local stock market that suffered from a volatility in June due to foreign funds’ exit from emerging markets.

On June 13, the main index plunged 6.75 percent, marking the deepest single day drop of the bellwether index since sinking by a record 12.27 percent on Oct. 27, 2008 at the height of Lehman Brothers’ bankruptcy that resulted in the global financial crisis.

Three firms have so far debuted in the local bourse: Philippine Business Bank, Asia United Bank and Del Monte Pacific Ltd.