Miguel R. Camus / Reporter, Business Mirror


EAST WEST Banking Corp. has set the lower range of its IPO offer price to P18.50 and maintained the maximum price to P23.50 per share.

The bank announced the indicative range as it prepares to sell shares to international and local investors in the latter part of next week. The medium-size lender, a unit of Gotianun holding firm Filinvest Development Corp. (FDC), based on a presentation made to investors on Tuesday. 

Including overallotments, the deal could be valued at up to P6.6 billion, making it the second-biggest initial share sale this year after GT Capital Holdings' P21.6-billion offer, which was formally launched before the Easter holiday. 

The final pricing and international allocation will be set on April 18 while the domestic offer period will run from April 20 through April 26. The company expects to make its trading debut on the Philippine Stock Exchange (PSE) on May 7.

The PSE earlier approved the lender's IPO, which seeks to sell 141.06 million new shares and 104.26 million secondary shares held by FDC, equivalent to a fifth of the company's total outstanding stock post-IPO. This is on top of an overallotment option for another 36.8 million shares.

East West Bank commenced operations in 1994 and is a lender mainly focused on providing services to retail and mid-market corporate customers, a strategy it plans to keep after the IPO.

Consumer and mid-range corporate clients will each account for 40 percent of the loan portfolio mix, with the remaining 20 percent going to larger corporate clients.

East West Bank plans to open at least 100 branches in 2012, as it capitalizes on its newly acquired licenses and selectively focusing on potentially profitable locations in so-called restricted areas and urban areas outside Luzon, its IPO filing showed. As of February, the bank had a network of 144 branches, of which 92 are in Metro Manila.

Net income last year dipped 4.3 percent to P1.73 billion, based on filings to the Securities and Exchange Commission.   

East West Bank expects to raise an estimated P2.98 billion in net proceeds from the primary offer, half of which will be spent on branch licenses. It said P744.7 million will be spent on the expansion of the branch network while P148.9 million is allotted to improving IT infrastructure. The remaining P595.7 million will be used for general corporate purposes.

International lead managers for the IPO are Deutsche Bank AG, Hong Kong Branch and J.P. Morgan Securities Ltd. while Unicapital Inc. serves as domestic lead underwriter.

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