FHB board proposes mandate to raise capital by more than two-thirds

Initiatives

jessica fejos

The board of FHB Mortgage Bank will ask shareholders for a two-year mandate to raise capital to 67.5% at an extraordinary general meeting on December 28, according to EGM proposals published late Friday.

(Photo: Jessica Fejos)

The board has justified the mandate citing FHBʼs accession to savings cooperative integrator SZHISZ and stricter regulatory capital requirements. The new regulations and expanding business, both in terms of FHBʼs own loans and loans it refinances, could generate an additional capital requirement of HUF 30-42 billion by the end of 2015, the board said.

At present, the board has a mandate to raise capital up to 25%. An earlier resolution prevents existing shareholders from exercising pre-emptive subscription rights if the board decides to raise capital, according to the proposal.

"Such an increase in share capital in accordance with the proposal has a significant dilution effect and could have a large impact on the shareholdersʼ structure in the Mortgage Bank," the boardʼs proposal says.

FHBʼs owners are VCP Finanz Holding (24.2%), A64 Vagyonkezelő (24.5%), Allianz Hungária Biztosító (10.4%), Silvermist Estate (9.6%) and the Hungarian National Asset Management Company (7.3%), according to data on the Budapest Stock Exchange updated on November 17. About 24.4% of the bankʼs shares are in free-float.

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