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UnionBank cuts rights offer size to P12B


By: Miguel R. Camus - Reporter / @miguelrcamusINQPhilippine Daily Inquirer / 04:08 PM December 28, 20

Aboitiz-led Union Bank of the Philippines is downsizing a planned rights offering to a maximum of P12 billion after signing a P20-billion loan deal in November.

In a stock exchange filing on Wednesday, the lender set the target size for its rights offer, however, other details including the timetable were not yet finalized.

“The bank’s latest balance sheet projections based on its economic outlook shows that any additional capital requirements beyond P12 billion can be internally generated from existing businesses,” the lender said in a stock exchange filing on Wednesday.

UnionBank said last Oct. 28 it was planning an equity fund-raising exercise worth as much as P20 billion. This would take the form of either a stock rights offer or private placement or a combination of both.

Last month, UnionBank signed a three-year $358-million (P20 billion) syndicated loan.

The loan, which will refinance maturing dollar loans and existing dollar bonds, was arranged by The Hongkong and Shanghai Banking Corp. Ltd. and MUFG Bank Ltd.

Last May, it raised P40 billion from a stock rights offer to partly finance the takeover of Citi Philippines’ consumer business and sold P11 billion in bonds last June.

The lender is part of Aboitiz Equity Ventures, the Aboitiz clan’s flagship conglomerate whose interest span power, finance, food, property, and infrastructure.

Net income from January to September dropped 5.6 percent to P10.1 billion. Still, it was up 67 percent to P4 billion in the third quarter alone after the lender completed the P72 billion takeover of Citi’s Philippine assets.

Excluding trading income, net revenues during the nine months jumped 37 percent to P36 billion while provisions for debt losses fell 43 percent to P2.3 billion.

Net interest margin also increased to 4.9 percent from 4.6 percent due to “the expansion of earning assets” and income from current and savings deposits, or Casa.

Net loans expanded 37 percent to P449 million while Casa ended with a record 31 percent growth to P417 billion, UnionBank added. Fee-based income expanded 64 percent to P5.1 billion.

By the end of September, UnionBank had total assets of P1.05 trillion, up 37 percent from the previous year.

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