On 11 September 2023, Lombard Bank Malta plc announced that it submitted an application to the Malta Financial Services Authority requesting approval of a prospectus in relation to a 2-for-3 rights issue of new ordinary shares, which shall form part of the same class and have equal rights to existing shares. The Rights Issue will first be offered to shareholders as at the close of trading on Friday 15 September 2023.
The announcement also noted that the rights issue price has been set at €0.75 per new ordinary share. This represents a discount of around 20% to the trade-weighted average price of the bank’s shares over the last six months of €0.93. It also represents a discount of over 50% to the net asset value of €1.51 per share as at 30 June 2023.
Any proportion of shares which are not subscribed to by eligible shareholders shall constitute lapsed rights. The lapsed rights will be first made available to eligible shareholders for the rights issue who would have applied for excess shares. Thereafter, in the event of any remaining excess shares, these shall be made available for subscription to employees of the bank and its subsidiaries, the bank’s directors and MaltaPost plc shareholders, and to the general public, in that order or preference.
Lombard explained that the rights issue will allow for further strengthening of its capital base both for regulatory purposes as well as for the implementation of the bank’s strategy for growth. Lombard noted that this is expected to result in increased profits and, subject to business requirements and regulatory approval, dividend distributions of circa one third of annual profits.
Further detailed information on the rights issue shall be available in the prospectus which will be published following the attainment of the necessary regulatory approvals.
On 18 September 2023, Lombard Bank Malta plc published a presentation which includes an overview of the company’s structure, its strategic objectives and the key targets following the anticipated capital injection through the Rights Issue.