Papua New Guinea’s regional bank BSP will revisit an earlier plan to list on the Australian Stock Exchange (ASX).
In a message to shareholders last week informing them on the progress of the company, BSP Group chairman Kostas Constantinou said dual listing will be part of its strategic plan moving forward, which, after COVID-19, would likely involve expansion into Asia.
BSP is currently listed on the Port Moresby Stock Exchange (PomSox).
“As you would be aware BSP had previously pursued a dual listing on the ASX. There were various reasons as to why this did not proceed. BSP’s Board and Executive team, in conjunction with Deloitte, recently conducted a Strategy Workshop to confirm the Banks strategic intentions over the coming term. Those deliberations confirmed that when the circumstances are favourable BSP should once again pursue a dual listing,” Constantinou said.
“Unlike the previous attempt, which was primarily focused on share liquidity, a future dual listing would be used to position BSP for potential capital raisings to fund offshore growth opportunities. A dual listing in the future, accompanied by a targeted growth program in Australasia, will deliver our shareholders significant financial benefits whilst increasing the value of the bank. In summary, BSP’s well-capitalised balance sheet enables the Board to consider appropriate growth opportunities that do not pose an unacceptable risk whilst adding value to our shareholders, customers, staff and Papua New Guinea.”
BSP’s interest in ASX was widely reported in the Papua New Guinea and Australian media in 2016 but later, it revealed the plan was on hold.
“The Board of BSP is continuing its consideration of initiatives to generate greater liquidity in BSP shares. BSP has not ruled out undertaking a secondary listing on the Australian Securities Exchange (Potential Listing), but is not currently of the view that there will be a significant public offer of shares in conjunction with the Potential Listing,” Constantinou had said in a statement filed at PomSox in April 2017.
Last week, the confirmation that it would revisit the option had accompanied the result of a research it commissioned into how it fared under a number of metrics that global banks use to measure each other’s performance.
The metrics were: Return on Assets, Return on Equity, Net Interest Margin and Efficiency Ratio.
“In all four Key Performance Measures BSP, is placed in the top quartile for similar banks globally, and the Bank significantly outperforms the average and median results for its peers. These results should provide our shareholders with the confidence of knowing BSP is outperforming comparative banks and is well placed to grow from a position of operational strength,” said Constantinou.
With the drastic slowdown in the global economy due to COVID-19, Constantinou said long term thinking was now critical for survival.
“I believe long-term thinking has never been more critical than it is today. Companies and investors with a strong sense of purpose and a long-term approach will be better able to navigate the Covid-19 crisis and its aftermath. This includes taking a strategic view of our region and the role we want BSP to play in it. The economy will recover. And for those who keep their eyes not on the shaky ground at our feet, but on the horizon ahead, there will be tremendous opportunities to be had,” he said.
BSP recently announced a profit after tax of Kina381.9million (US$108.5million) for the half year ended June 2020, down from Kina434.9million (US$123m) for the same period last year.
Last week, it announced a consolidated net profit after tax of K216m (US$61.5m) for the 2020 third quarter, a 31 percent increase from Q2, 2020.
BSP has branches in Vanuatu, Tonga, Solomon Islands, Samoa, Fiji, Cook Islands and is headquartered in PNG.
