PNB board approves issuance of property dividends to stockholders
(April 26, 2021) — The Board of Directors of Philippine National Bank (PSE: PNB) has approved the declaration of shares of PNB Holdings Corporation as property dividends effective May 18, 2021. In a disclosure to the Philippine Stock Exchange on April 23, 2021, PNB announced that the bank declares PNB Holdings Corp. shares as property dividends to the stockholders of PNB on record as of May 18, 2021.
Earlier this year, PNB obtained approval from the Securities and Exchange Commission to increase its equity investment in PNB Holdings Corporation.
The investment into PNB Holdings and the dividend declaration are two important phases of the bank’s strategic initiative to recognize the unrealized value of its three major properties, namely: the PNB Financial Center in Pasay, PNB Makati Center in Ayala’s Central Business District, and the Prime Property at the corner of Buendia Avenue and Paseo De Roxas, also in Makati.
PNB is pursuing plans to reduce its low-earning assets to build up its financial position. PNB Holdings increased its authorized capital stock to reflect the value of the three prime properties.
“The timing of the development of these properties are already being studied by the real estate experts, who are already working closely with PNB Holdings Corp. and PNB,” PNB President and CEO Wick Veloso said. “The distribution of PNB Holdings shares through the dividend declaration allows PNB stockholders to share from the benefit of the realized values of the properties and any future valuation gains.”
Property dividends occur when a company declares and distributes assets other than cash, such as shares of stocks in a company’s subsidiary or affiliate or tangible products of the company. Through the distribution of PNB Holdings Corporation shares via the declaration of the property dividends, all shareholders of PNB will become part owners of PNB Holdings, allowing them to benefit from future potential gains from the development of the properties, either through potential dividends and/or through the increase in the valuation of the shares.