Business

Bank Audi increases capital by $300M

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(BEIRUT, LEBANON) — Bank Audi announced Tuesday that it has completed a $300 million capital increase by offering $240 million in common shares initially to existing shareholders (including GDR holders) of the bank and a $60 million subscription of common shares by International Finance Corporation (“IFC”), a member of the World Bank Group. The IFC now controls 20 percent of the new shares and became a minor shareholder of the total outstanding shares of the bank.

With the new capital increase, Bank Audi’s shareholders equity is now $3 billon.

According to the statement of the bank, the subscription price per common share was $6, and eligible subscribers were allocated three warrants per common share subscribed entitling to purchase one common share of the bank’s Turkish subsidiary, Odea Bank, for each warrant.

Over $25 million of Bank Audi shares were traded on the Beirut bourse Monday as part of efforts to raise the capital of the bank.

Bank Audi’s statement said $50 million in common shares were issued in the capital increase, as well as 149,528,847 warrants, representing approximately 10.0 percent of Odea Bank’s common shares.

“There was an initial take-up of 87.1 percent of the rights issue by existing shareholders (including a take-up of 94 percent by holders of the Bank’s Global Depositary Receipts (GDRs), with the balance taken up in full through residual subscriptions by existing shareholders),” the statement added.

It said the proceeds of the capital increase would be used to extend the bank’s financial flexibility, strengthen its regulatory capital and support its business development within and mostly outside Lebanon.

Samir Hanna, Group CEO of Bank Audi, commented: “We are very satisfied with the success of this transaction, which was conducted in difficult regional conditions and showed the confidence of existing and new shareholders, including IFC, in the bank’s performance and direction. The partnership with IFC will further assist the bank in expanding our access to underserved segments, such as small and medium enterprises and support our planned expansion to new jurisdictions, in particular where IFC has significant in-country knowledge and experience.”

Bank Audi, the largest Lebanese bank in terms of assets and deposits, operates in 13 countries. As of June 30, 2014, Bank Audi’s consolidated assets stood at some $39.3 billion, private customers’ deposits were $34 billion and shareholders’ equity was $2.7 billion (pre-capital increase). Bank Audi recorded a net profit of $190 million in the first half of 2014, slightly higher than the same period of last year.

Freddie C. Baz, General Manager-Group Chief Financial Officer of Bank Audi, told The Daily Star earlier Audi hopes its subsidiaries and branches abroad will increase their share of the bank’s total profits.

At present, nearly 70 percent of Bank Audi’s profits come from Lebanon operations.

Source: The Daily Star

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