PNB plans to raise P5.5B in fresh capital

MANILA, Philippines - The Philippine National Bank (PNB) is planning to raise P5.5-billion in fresh capital this year.

PNB president and chief executive officer Eugene S. Acevedo said that they want to raise the said amount within the first quarter of the year.

“We could have raised it earlier but we waited for the Basel III guidelines,” Acevedo said over the weekend.

The Basel III framework was released only recently outlining the type of capital required of banks based on the type of risks, which were also outlined by the new regulatory environment. “We are in discussion with our arrangers, but we will finalize that within the next few weeks,” he said.

Meanwhile, PNB is looking at expanding its net earnings in 2010 by at least 16 percent or roughly P400 million more than the P2.2 billion recorded in 2009. In the first nine months of 2010, net earnings already reached P2.45 billion.

The market has already assumed that PNB would breach the P2.7 billion-mark in 2010, and expand by another 16 to 20 percent to P3.2 to P3.3 billion in 2011.

To achieve net earnings over the P3-billion ceiling, PNB will have to aggressively expand its consumer banking activities. It is comfortably strong in the treasury and corporate markets.

Acevedo said that he would like to improve the bank’s loan profile within the next five years.

“My dream is that over the next five years, the consumer business will be 30 percent. In other words, one-third consumer, one-third treasury, and one-third corporate,” Acevedo said.