Jul 122013

MANILA, Philippines – Metropolitan Bank & Trust Co. (Metrobank), the main banking unit of the Ty family, will double its capital to P100 billion to keep up with the global Basel 3 requirement.

In a disclosure to the Philippine Stock Exchange (PSE), Metrobank said it has received approval from Bangko Sentral ng Pilipinas (BSP) to increase its authorized capital stock from P50 billion to P100 billion.

The increase would be divided into four billion common shares and one billion preferred shares, each with a par value of P20 per share.

“The BSP approval of the amended articles of incorporation together with the earlier approval of 30-percent stock dividend declaration shall be subject to the approval of Securities and Exchange Commission (SEC),” it said.

As previously disclosed, the 30-percent stock dividend equivalent to 633.41 million common shares amounting to P12 billion shall be applied as payment of the required  25- percent subscription to the increase in authorized capital stock.

Earlier, Metrobank announced its plan to issue some $500 million worth of Tier 2 capital notes to comply with the Basel 3 requirements.

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Metrobank informed the PSE that the issuance of the Basel-3 compliant Tier 2 notes was approved by its board in a meeting last April.

It said the planned issuance would also allow the bank to proactively manage its capital base for growth and refinancing of maturing capital securities.

The Basel 3 guidelines issued by the BSP requires that Tier-2 notes have a provision for the instrument to either be written off or converted to common equity upon occurrence of certain trigger events. The BSP circular further stipulates that banks must make the necessary amendments to its articles of incorporation to accommodate such a conversion.

This year, Metrobank expects its loan portfolio to expand 15 percent.

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