Ibercaja chooses to create the reserve fund and will go public when conditions are "more favorable"

MADRID, 24 Jun. (EUROPA PRESS) -

The Ibercaja Banking Foundation, the main shareholder of Ibercaja Banco, has communicated this Monday its decision to create the reserve fund and delay its IPO for when conditions are "more favorable", according to the notification it sent this Friday to the Commission National Securities Market (CNMV).

Specifically, it indicates that it has received approval from the Bank of Spain for its Financial Plan for 2022, which includes the creation of a reserve fund equivalent to 1.75% of the bank's risk-weighted assets, around 316 million euros, with data at the end of 2021. The maximum period for the endowment of this fund extends until the end of 2025, specifies the institution.

The allocations to the new reserve fund will come entirely from the dividend that the bank distributes to the foundation, based on the ordinary profits from its activity in the coming years, in accordance with the projections included in the Ibercaja Banco business plan.

With a planned 'pay out' of 60%, the foundation indicates that there will be no need to carry out any exceptional disinvestment and extraordinary dividend operations to feed this reserve fund.

In this way, the foundation is released from the deadline of December 31, 2022 to go public, a procedure that was included in the Savings Banks and Banking Foundations Law to reduce the foundations' holdings in the old savings banks. savings below 50%.

The regulations contemplate that there are foundations that have a stake of more than 50% in these entities, although it requires the preparation of an investment diversification plan to minimize risks and establish this reserve fund to guarantee the financing of the bank in situations of difficulties.

In addition, they cannot exercise political rights when they participate in capital increases under certain conditions and the distribution of dividends must be approved by a reinforced quorum and majority of the general meeting.

"With this set of measures, banking foundations are encouraged to gradually reduce their participation in credit institutions, so that the restructuring process of the Spanish financial system is completed in a reasonable period of time", states the Savings Banks Law and Banking Foundations.

However, neither the foundation nor the bank have ruled out an IPO, but rather have postponed it until conditions are "more favorable". Ibercaja had opted for this solution to reduce the foundation's participation in its shareholding, although market conditions in the last two years have caused repeated delays.

In this sense, the entity was prepared to go on the market in March 2020, although the arrival of the Covid-19 pandemic ruined the plans for its debut on the parquet; some preparations that the bank had started at the end of 2018.

Initially, the banking entities subject to the regulations of the Law on Savings Banks and Banking Foundations that had chosen to go public --instead of creating the reserve fund-- had a deadline to carry out the procedure until 2020, although the Government extended the period for another two years, until December 31, 2022, as a result of the pandemic.

For this reason, this year was going to be the last in which Ibercaja could fulfill the mandate, although there was speculation that the Executive would give more time so that the jump to the bank's trading floor could be carried out.

With the intention of complying with the plans to start trading, Ibercaja announced on January 20 its intention to go public through an initial public offering for the sale of ordinary shares to qualified investors.

However, at the beginning of February, the bank decided to delay the operation due to the high volatility registered in the markets as a result of geopolitical tensions, a situation that worsened after the Russian invasion of Ukraine.

Since then, the bank has considered several 'windows' to carry out the operation, such as April or this same month of June, although the situation in the markets continues to be volatile due to the uncertainties generated by the conflict in Ukraine, the high inflation and rate hikes.

Thus, in recent months, the option of creating a reserve fund had gained strength, which would release the bank from the obligation to go public before the end of the year, without ruling out carrying out the operation later, the solution for which which has finally been chosen.