April 02, 2014

RCB to raise $200m from debt and equity deals this year

Rizal Commercial Banking Corp (RCBC) yesterday disclosed plans to issue up to P5b worth of Basel 3 compliant Tier 2 Notes. On top of this, RCB is looking to generate further funding from equity issuances this year. The Philippine Daily Inquirer quoted an RCB official as saying that the bank is looking to generate at least $100m more from the sale of new common shares, proceeds of which will be used to support future organic growth and potential acquisitions.

Our take: The bank has practically completed the clean-up of legacy deferred charges through a series of share issuances and placements in the past few years. While the capital infusions bode well for the bank’s growth, the frequency of the issuances and placements may be taken negatively by the market because of the resulting share dilution. – WealthSec