May 2013 Financial News

First Citizens IPO set for June

May 09, 2013

The First Citizens bank initial public offering (IPO) of shares has been postponed from May to June, said deputy chief executive officer Sharon Christopher.

In early January, the bank’s chair Nyree Alfonso said the IPO was scheduled to be launched in May.

Christopher anticipated the issuance of shares would be a big deal.

“We expect that the value of the issue to be in the range of $1 billion, so it would be big for T&T,” she said.

Asked the reason for moving from May to June, Christopher said: “Getting together the documentation for the IPO, the valuation of the bank—the number of things that had to be done—was taking a little longer than expected. We are on the ball now. This is like the countdown period.”

A share price has not yet been determined because the valuation process is incomplete.

At each stage, Christopher said more information would be made to the public but, to the “big institutional investors, we would be going to them with some harder figures than we have now.

“It is worth everyone’s while to have a share in this significant indigenous institution.”

Asked when she anticipated a share price to be determined, Christopher said: “All these things have to be discussed with the Government; it’s not just First Citizens by itself.

“After we get the valuation, the valuation is going to say this is what your bank is valued at. We would then be able to say, if that is our value, we look at our share price in this kind of range, then we go back to Government and then they would agree, okay, you can do it at that price. So that should take three weeks before we have a price.”

Christopher said the IPO is long overdue.

“When First Citizens started 20 years ago, it was always the intention that the bank would come back to the public and would be listed on the stock exchange. What is going to happen this year is really the realisation of that vision.”

Christopher said large institutions and the public have expressed interest in the launch.

“If you look at this institution for the last three years coming out of the current financial crisis, this bank has been named by Global Finance as the safest bank in the Caribbean.

Commenting on dividend payout, she said: “We expect our dividend payments to be reasonable. The reason we have been so successful is (due to) the way we have managed our business: in a very stable and consistent manner. Certainly, your return on your investment is going to be good.”

In January, Alfonso, commenting on dividend payout, said: “First Citizens expects to time the half-year dividend so that the new shareholders of the bank would benefit by receiving a distribution within 30 days of the completion of the IPO.

“The bank paid out 37 per cent of its after-tax profit of $718 million as a dividend in the year ending September 2011, and 24 per cent of the $446.4 million that the company earned in 2012.”


Source:
Nadaleen Singh
Trinidad Guardian
Thursday May 9, 2013

​http://www.guardian.co.tt/business-guardian/2013-05-08/first-citizens-ipo-set-june