THE Securities and Exchange Commission (SEC) has approved the issuance of P800 million worth of short-term commercial paper of brokerage and leasing and financing firm Philippine Commercial Capital Inc. (PCCI).
The SEC said in its approval that it also grants the request of the firm to exempt the said debt papers from registration from the agency.
Companies normally seek the approval from the SEC when it is raising funds from the public.
The PCCI, however, said its papers will be issued to not more than 19 persons, including the company’s directors, officers and other stockholders.
According to SEC memorandum released in 2011, issuances in excess of P50 million worth of commercial papers is considered exempt from registration subject to prior approval of the agency.
The company said that proceeds of the debt papers will allow the company to grow beyond its present size, enabling it to be more competitive in the market.
“The company will be able to expand its underwriting activities in line with the continuing growth in the market,” PCCI said.
“The company has been one of the significant players in the industry, and has, thus far, proven its financial strength over the years. The company firmly believes that it has the capability to meet increased borrowings,” it said.
The SEC said PCCI was able to satisfy all of the requirements required by the Securities and Regulation Code.
“Moreover, the commission may take comfort in the fact that the company has shown in its financial ratios that it will be able to meet its financial obligations,” the SEC said.
As of February 2015, PCCI said it will be able to meet its short-term obligation at a ratio of 1.78:1, which means there is a corresponding P1.78 of current asset for every P1 of short-term liability that matures. The ratio also showed that the stockholders equity in the company is greater than the funds borrowed from the creditors.
The company also has a debt to equity ratio of 1.26:1 and net profit to sales ratio of 0.45.
VG Cabuag