First BanCorp, parent company of First Bank, announced Wednesday that, effective Jan. 7, it will implement a 1-for-15 reverse stock split of all outstanding shares of its common stock as it pulls at its options to remain listed on the New York Stock Exchange.
Through the transaction, First BanCorp will reduce the number of outstanding shares of common stock from approximately 320 million to some 21 million. It is expected that by having fewer stock available, the value of First BanCorp’s shares — which closed at .49 cents on Wednesday — will increase. The bank has been struggling to regain its financial footing for the better part of the last year.
“We appreciate the support of our stockholders in granting our board the authority to effect a reverse stock split. After a thorough consideration of our options, the board determined that a reverse stock split of the Corporation’s common shares is in the best interest of stockholders,” said First BanCorp President Aurelio Alemán. “A reverse stock split better positions the Corporation to accomplish its capital strategies and regain compliance with the NYSE listing rules.”
Wednesday’s announcement is the latest in a string of moves that First BanCorp has been implementing recently to improve its assets.
Last month, the bank said it intended to sell $701.9 million in bad loans at a sharp discount, for which it expected to receive $401.9 million, or 57.5 percent of the value of the portfolio.
Business reporter with 30 years of experience writing for weekly and daily newspapers, as well as trade publications in Puerto Rico. My list of former employers includes Caribbean Business, The San Juan Star, and the Puerto Rico Daily Sun, among others. My areas of expertise include telecommunications, technology, retail, agriculture, tourism, banking and most other segments of Puerto Rico’s economy.
“This project not only represents a significant investment in our island’s tourism infrastructure, but also symbolizes Puerto Rico’s ability to attract and execute large-scale projects.
The Investment Portfolio Program, with a budget of $800 million, plays a crucial role in offering loans with favorable terms for the development of projects that have the potential to transform the Puerto Rican economy.”
— Puerto Rico Housing Secretary William Rodríguez regarding the construction of a $77 million dual-branded hotel project in San Juan’s Convention Center District, featuring Hilton’s Hampton and Homewood Suites.
The project by PRISA Group includes a 400-vehicle parking structure and a 175,000-square-foot hotel tower, financed by Banco Popular and a $10 million federal disaster recovery loan from the Economic Development Investment Portfolio Program managed by the Department of Housing.