Fibank’s Request For Cap Hike Rejected By Bulgarian Authorities

Bulgaria’s Financial Supervision Commission (FSC) said that it has rejected the capital increase prospectus of local lender First Investment Bank (Fibank) [BUL:5F4].

The regulator did not provide further information in its statement, published on Thursday.

Last month, the FSC asked Fibank to provide additional information and documents regarding the company’s request for approval of a capital increase prospectus.

In December 2019, Fibank said that it is planning to offer 40 million shares for subscription at a price of 5 levs ($2.8/2.6 euro) apiece. However, the price of the shares could be revised by the time the company completes its prospectus, Fibank noted at the time. Fibank shares closed 0.67% higher at 3 levs on the Bulgarian Stock Exchange on Thursday.

The lender was planning to use the proceeds to support its strategy for expansion of its SME and consumer loan portfolios.

The capital increase was the latest part of a broader effort by the lender to strengthen its capital position. In December 2019, Fibank placed a 30 million euro ($33.2 million) bond issue with an annual coupon of 8%, and signed deals to sell non-performing loan (NPL) portfolios with a total face value of some 538 million levs.

Last year, the European Central Bank (ECB) said it has found a capital shortfall of 262.9 million euro at Fibank.

Fibank was Bulgaria’s fifth largest lender by assets at the end of 2019, according to the latest central bank data.

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