Zorba
Bos 4 Mod
Banco Espirito Santo announced on 18th Oct an exchange offer proposal to be approved at an extraordinary meeting on 11/11/2011.
The proposal offers new ordinary shares in exchange for six subordinated bonds and prefs.
The exchange prices range from 61% up to 100% nominal for the different instruments.
The share price will be calculated as the average of previous 5 days' closing with a minimum of 1.80 euros (today's price 1.58 down 8.5% on the day, so a further discount if the price doesn't recover).
Instruments involved:
PTBENBOM0021
PTBER00M0030
PTESSMOOM0016
XS0147275829
XS0207754754
XS0171467854 pref
BES have obviously been buying heavily in the market this year. There were 489m euros of the XS0147275829 (which I hold) outstanding at the end of 2010. In this notice they disclose they now own 347m euros of the 500m issued.
The XS0147275829 has a first call in May 2012 and is therefore one of the bonds with a first call in the CRDIV window period of pre-1/1/2013 which will no longer count as Tier 2 capital if not called with an incentive to redeem.
The aim of the exchange is to improve capital ratios:
b) The Bank of Portugal has established that the banks should have a minimum Core Tier I of 9% in December 2011 and 10% in December 2012;
c) At June 30, 2011, the capital ratios of the BES Group where: 8.2% Core Tier I, 9.2% Tier I and 11.5% Total Ratio;
The details of prices and terms do not yet seem to have been posted on the bank website. I have a copy from my stockbrokers and if anyone wants a copy please e mail me off board.
The only official announcement on the BES website is below:
The Board of Directors of Banco Espírito Santo (BES) decided today to convene an Extraordinary Shareholders’ Meeting to be held on November 11, 2011 at 10 am in Hotel Altis, Lisbon. Aiming to reinforce the core capital of Banco Espírito Santo, and in light of the capital requirements established by the Bank of Portugal under the Memorandum of Economic and Financial Policies established between the Portuguese Government, the European Commission, the European Central bank and the International Monetary Fund, the Board of Directors will submit a proposal to increase the share capital of BES by new contributions in kind up to Eur 790.7 million, comprising securities issued by Banco Espírito Santo, Banco Espírito Santo de Investimento and by BES Finance, Ltd. This transaction could generate a positive impact up to 147 basis points in core tier I considering the RWA of Eur 66.4 billion as of June 30, 2011.
The Board of Directors will also propose to increase the maximum amount authorized for the Board to increase the Company’s share capital from Eur 5 billion to Eur 7.5 billion in order to provide a greater flexibility to deliberate on share capital increases that might be deemed necessary in the future. Such capital increases shall always be subject to the shareholders pre-emption rights, except where the General Meeting will resolve to limit or suppress such preemption rights.
In order to increase its liquidity position, Banco Espírito Santo aims to request personal guarantees from Portuguese State to issue non subordinated bonds up to the aggregate amount of Eur 3.5 billion with maturity up to 3 years. Thus, the Board of Directors will propose to the Shareholders’ Meeting to suppress the Shareholders’ pre-emption rights in the event of a capital increase resulting from the execution of the above mentioned guarantees.
Releases
The proposal offers new ordinary shares in exchange for six subordinated bonds and prefs.
The exchange prices range from 61% up to 100% nominal for the different instruments.
The share price will be calculated as the average of previous 5 days' closing with a minimum of 1.80 euros (today's price 1.58 down 8.5% on the day, so a further discount if the price doesn't recover).
Instruments involved:
PTBENBOM0021
PTBER00M0030
PTESSMOOM0016
XS0147275829
XS0207754754
XS0171467854 pref
BES have obviously been buying heavily in the market this year. There were 489m euros of the XS0147275829 (which I hold) outstanding at the end of 2010. In this notice they disclose they now own 347m euros of the 500m issued.
The XS0147275829 has a first call in May 2012 and is therefore one of the bonds with a first call in the CRDIV window period of pre-1/1/2013 which will no longer count as Tier 2 capital if not called with an incentive to redeem.
The aim of the exchange is to improve capital ratios:
b) The Bank of Portugal has established that the banks should have a minimum Core Tier I of 9% in December 2011 and 10% in December 2012;
c) At June 30, 2011, the capital ratios of the BES Group where: 8.2% Core Tier I, 9.2% Tier I and 11.5% Total Ratio;
The details of prices and terms do not yet seem to have been posted on the bank website. I have a copy from my stockbrokers and if anyone wants a copy please e mail me off board.
The only official announcement on the BES website is below:
The Board of Directors of Banco Espírito Santo (BES) decided today to convene an Extraordinary Shareholders’ Meeting to be held on November 11, 2011 at 10 am in Hotel Altis, Lisbon. Aiming to reinforce the core capital of Banco Espírito Santo, and in light of the capital requirements established by the Bank of Portugal under the Memorandum of Economic and Financial Policies established between the Portuguese Government, the European Commission, the European Central bank and the International Monetary Fund, the Board of Directors will submit a proposal to increase the share capital of BES by new contributions in kind up to Eur 790.7 million, comprising securities issued by Banco Espírito Santo, Banco Espírito Santo de Investimento and by BES Finance, Ltd. This transaction could generate a positive impact up to 147 basis points in core tier I considering the RWA of Eur 66.4 billion as of June 30, 2011.
The Board of Directors will also propose to increase the maximum amount authorized for the Board to increase the Company’s share capital from Eur 5 billion to Eur 7.5 billion in order to provide a greater flexibility to deliberate on share capital increases that might be deemed necessary in the future. Such capital increases shall always be subject to the shareholders pre-emption rights, except where the General Meeting will resolve to limit or suppress such preemption rights.
In order to increase its liquidity position, Banco Espírito Santo aims to request personal guarantees from Portuguese State to issue non subordinated bonds up to the aggregate amount of Eur 3.5 billion with maturity up to 3 years. Thus, the Board of Directors will propose to the Shareholders’ Meeting to suppress the Shareholders’ pre-emption rights in the event of a capital increase resulting from the execution of the above mentioned guarantees.
Releases
), l'unico neo è il corrispettivo in azioni.
