The initial public offering (IPO) subscription of Midland Bank opens today (Thursday) and will continue until February 23, which will raise Tk 700 million under the fixed price method.
The fourth-generation private commercial bank also offers 7.14 per cent IPO shares to its employees under the employees share purchase plan (ESPP).
Midland Bank is the first commercial bank in the country that is offering initial public offering shares to its employees, the bank said in a statement.
Of the total 700 million shares, 5 million are reserved for the employees of the bank and the remaining 65 million will be distributed among the eligible investors (EIs) and general public as per BSEC (Public Issue) Rules, 2015.
The minimum required investment for the general public is Tk 50,000 and for non-resident Bangladeshi is Tk 100,000 as on February 8 in matured listed securities for applying IPO shares, according to a stock exchange filing on Monday.
The general public could subscribe to a minimum and maximum amount of Tk 10,000 for IPO shares.
The minimum required investment amount would be Tk 15 million for approved pension funds, recognised provident funds and approved gratuity funds while other eligible investors shall be Tk 30 million for IPO application.
The bank received approval from the Bangladesh Securities and Exchange Commission (BSEC) on September 21 last year for raising the said amount.
Of the IPO proceeds, the bank will invest over Tk 610 million in treasury bonds, Tk 50 million in the listed securities, and the remaining funds for catering the IPO expenses.
The sponsor-directors of Midland Bank must jointly hold at least 30 per cent of the bank’s shares, while each director must individually hold at least 2 per cent, before the bank’s stock market listing, as per the BSEC condition.
Also, the bank will have to appoint independent directors as per the corporate governance guidelines of the securities regulator.
As per the financial statements for the year ended on December 31, 2021, its net asset value per share (without revaluation) and earnings per share are Tk 13 and Tk 0.90 respectively. The five years weighted average EPS was Tk 1.07.
Midland Bank will be the 35th listed bank in the country’s capital market. LankaBangla Investments is acting as the issue manager.