The Bank of the Philippine Islands or BPI was permitted by the Bangko Sentral ng Pilipinas to increase its authorized capital stock from P50.6 billion to P54.6 billion as it finalizes merger with Robinsons Bank Corporation.

In a disclosure to the Philippine Stock Exchange on Wednesday, BPI said the Bangko Sentral ng Pilipinas approved the expanded authorized capital stock on 21 December.

Such stock is divided into 60 million units of preferred shares and 5.4 billion units of common shares. Both have a par value of P10 per share.

Surviving entity

BPI, the surviving entity, said three percent of the common shares is set as employee stock incentive plans, of which 1.5 percent is considered as executive stock option plan and the remaining portion as stock purchase plan.

BPI stressed that qualified shareholders who are employees and officers of BPI and its subsidiaries will have no pre-emptive rights over the stocks.

The bank added that this condition will also be applied to 406,179,276 treasury shares which the bank will dispose of in compliance with the General Banking Law of 2000.

Merger advanced

The BSP's approval for the increased authorized capital advanced the merger between Ayala-owned BPI and Gokongwei-led Robinsons Bank Corporation which is expected to take effect soon on 1 January.

The decision on the stock came after the BSP authorized the proposed merger on 14 December.

"The proposed merger will unlock various synergies across several products and service platforms, expand the customer and deposit base of both banks through the merged entity, and, at the same time, by capitalizing on BPI's expertise and network, enhance the overall banking experience of Robinsons Bank customers," BPI said.

Under their consolidation terms, BPI will issue common shares to Robinsons Bank shareholders which are equivalent to 6 percent of the resulting outstanding common shares or 314,003,992 shares.