MANILA, Philippines - Gotianun-led East West Banking Corp. raised its capital by 150 percent as part of efforts to sustain its momentum as the fastest growing bank in the Philippines.
EastWest vice chair and CEO Antonio Moncupa Jr. said the bank’s board of directors approved the increase in its authorized capital to P50 billion from P20 billion during a special meeting yesterday.
The bank’s authorized capital would consist of 4.5 billion common shares with a par value of P10 per share and 500 million preferred shares with a par value of P10 per share.
EastWest also declared a 50 percent stock dividend or 750 million common shares to cover the required minimum subscription and payment for the increased in authorized capital.
Moncupa explained the bank has fully issued its authorized common stock and its common equity tier 1 ratio is around 10 percent.
“EastWest is growing fast. And to sustain the growth momentum, it is pretty obvious that we need to raise capital,” he said.
Moncupa said the bank could raise funds to bankroll its aggressive expansion program.
“Although nothing is certain at this time if we will do a stock rights, we need to start preparing. And this increase is part of the preparation,” he said.
The bank founded by the late taipan Andrew Gotianun also raised the number of board of directors to 11 from nine to enhance its effectiveness in conducting its business.
The bank’s board of directors would endorse the increase in authorized capital, the stock dividend, and the increase in the number of board seats for stockholders’ approval in due time.
EastWest is looking at a 25 percent rise in net income to P4.25 billion this year from P3.41 billion last year.
In the first quarter alone, the bank’s profit surged 54 percent to P1.21 billion from P786.61 million in the same quarter last year. Gross revenues rose 18 percent to P6.04 billion in the first quarter from P5.1 billion in the same period last year.
“Business has been good. We expect revenue growth to continue besting increases in costs. At the rate we are going, a 25 percent increase in income this year to around P4.25 billion is doable,” Moncupa said earlier.
EastWest has now almost tripled its branch stores to 446 from 168 in end 2011. The store network expansion initially resulted to a flat income of P2 billion from 2013 to 2015.