Sources inform ''Globes'' that Bank Hapoalim's (TASE: POLI) Turkish subsidiary Bankpozitif Credi Ve Kalkinma Bankasi AS is raising capital in Israel, as part of a $150 million issue of five-year bonds to institutional investors.
Bank Hapoalim declined to comment on the report.
The bonds bear a 7% dollar interest rate, considered reasonable for a BB-rated bank. The offering in Israel is part of an offering in London, Switzerland, and the Netherlands. Israeli institutional investors have already committed to buying $80 million of the bonds. Banking sources say that the offering is a success, and believe that it may be expanded.
BankPozitif will use proceeds to expand is business and to try to ease its most pressing problem - its cannot take deposits from the public, because its license from the Turkish The Banking Regulation and Supervision Agency does not allow it. BankPozitif can therefore only seek to increase its shareholders' equity.
BankPozitif currently has $150 million in bonds, which mature between June 2012 and February 2013, and it is therefore expected to hold another offering in 2012.
Bank Hapoalim acquired control of BankPozitif in 2006, and now owns 69.8%. BankPozitif has an estimated value of $250 million, $273 million in shareholders' equity at the end of June, a balance sheet total of $1 billion, and a capital adequacy ratio of 30%. It acquired a Kazakhstan bank in November 2007.
Bank Hapoalim has invested NIS 881 million in BankPozitif to date. BankPozitif distributed a $32 million dividend in March, but no more dividends are expected anytime soon.
Published by Globes [online], Israel business news - www.globes-online.com - on October 22, 2009
© Copyright of Globes Publisher Itonut (1983) Ltd. 2009