NRBC: First bank in 12 years to go for IPO

NRB Commercial Bank is going public to raise Tk 120 crore from the stock market, a move that would make it the first bank in Bangladesh in 12 years to be listed on the bourse.

The initial public offering was approved at a meeting of the Bangladesh Securities and Exchange Commission (BSEC) yesterday.

With the consent, the country's bourses are set to get a bank's stock for the first time in 12 years, the BSEC said in a press release. The bank will issue 12 crore ordinary shares at face value.

The bank began its journey on April 2, 2013, as a scheduled bank.

NRB Commercial Bank registered deposits of Tk 7,185 crore in 2019. Its total loans and advances amounted to Tk 6,201 crore.

The IPO proceeds will be used to buy government securities and enhance the lender's investment in the stock market, the press release added.

The bank's weighted average earnings per share for the last five years was Tk 1.55. Per-share net asset value stood at Tk 13.86 as of June 30, 2020.

NRB Commercial Bank's return on the asset was 1.46 per cent.

For the betterment of the stock market, the bank's IPO subscription will be completed next February, the BSEC said.

The commission set a later date for the subscription following demands from investors, who said they were facing liquidity shortage because of an increase in the IPOs in recent times.

AFC Capital and Asian Tiger Capital Partners Investment is the IPO's issue manager.

During the commission meeting, the BSEC also decided to impose a fine on the chairman and three officials of Stylecraft, an export-oriented garments manufacturer, for breaching the securities rules.

"They broke the rules related to insider-trading and will be fined a similar amount to what they earned from illegal trading," the BSEC said.

The stock market regulator also gave its consent to Lub-rref to publish its prospectus to raise Tk 150 crore by issuing 4.52 crore shares through the book-building process.

When a company wants a higher price than face value while issuing new shares, the price is determined through bidding, which is called the book-building method.

The BSEC asked eligible investors to submit bidding analysis and procedure for bids over Tk 50 for each share of the company.

It would look into the process whether the eligible investors follow the due process, the BSEC added.