Philippine Star
Business
Written by Zinnia B. Dela Peña


MANILA, Philippines - EastWest Banking Corp., the banking arm of the Gotianun family, has earmarked P2.45 billion for its capital expenditures this year, mostly for the continued expansion of its branch network and the improvement of its information technology system.

This year's capex is higher than what the bank spent in the past three years – from P613 million in 2009.

In a prospectus submitted to securities regulators, EastWest Bank said it intends to continue to grow as a significant player in the financial services industry by increasing its asset and deposit base as well as its branch network.  It ranked 17th among the country's commercial and universal banks in terms of total assets as of Sept. 30, 2011.

EastWest Bank ended 2011 with a total of 122 branches.  It acquired 105 additional licenses to open new branches in locations that are characterized as deposit-rich areas of Metro Manila and 140 branch licenses in non-restricted areas.

The bank will continue to further expand through potential strategic acquisitions alongside its organic growth.  It regularly evaluates potential acquisition targets and may in the future seek to acquire other businesses to expand its operations.

Aside from this, EastWest Bank is targeting a loan portfolio mix of 40 percent consumer loans, 40 percent mid-market corporate loans and 20 percent large corporate loans.

To bankroll its expansion, EastWest Bank is undertaking an initial public offering (IPO) to raise as much as P6.6 billion.  Without the greenshoe option, the bank and its selling shareholders will generate P5.76 billion.

The bank is offering 245.32 million common shares, representing 25 percent of its outstanding stock, at a maximum price of P23.50 each.  Of the total, 141.06 million are new shares to be issued by EastWest Bank while the remaining 104.26 million will come from majority shareholder Filinvest Development Corp.

In case of strong demand, the selling principal shareholders have set aside 36.8 million shares for over allotment.