Kina enters shares deal with ADB

The National Business

KINA Securities Ltd, has entered into a binding share subscription agreement with Asian Development Bank (ADB) for a placement of 10,751,916 securities at AU$1.3730(K3.09)/ share.
According to Kina, the agreement will further strengthen Kina’s international correspondent banking relationships and open up Papua New Guinea’s corporate export and resources sector as an important source of foreign currency.
Kina will use the funds to continue to grow its small-to-medium enterprises (SMEs) and retail segment and build its digital capabilities enabling Kina to offer broader product mix including trade finance products to SMEs.
The key terms of the transaction:

  • ADB has subscribed for 10,751,916 Kina shares at AU$1.3730 (K3.09)/ share equating to US$10m (K33.28mil); and,
  • It aligns with Kina’s total societal impact objective to be a responsible and ethical corporate citizen by adopting an environmental and social management framework in line with international best practice.

Kina chief executive Greg Pawson said: “The investment by ADB was a great development and endorsement for the group and for Kina Bank, its customers and shareholders.
“Attracting an investment by ADB represents a key endorsement of our five-year strategic plan.
“The reputation, strength and capabilities that the ADB brings will enable us to better deliver on our purpose of empowering our customers and communities to have financial independence and security.”
ADB is a multilateral development bank which is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining efforts to eradicate extreme poverty.
In 2018, it made commitments of new loans and grants amounting to AU$21.6 billion (K71.89 billion). Established in 1966, it is owned by 68 members – 49 from the region.
“This transaction is an important milestone in our efforts to promote financial inclusion in Papua New Guinea,” ADB’s private sector operations department director general Michael Barrow said.
“With its focus on SMEs, along with the high employment potential that comes with developing this segment, Kina is helping to create the conditions for inclusive growth.
“We look forward to supporting the bank’s continued efforts to boost access to sustainable financial services in PNG.”
The placement has been done under Kina’s ASX (Australian Securities Exchange) Listing Rule 7.1, 15 per cent placement capacity.
Settlement is expected to take place on Friday.
Morgans Financial Ltd acted as financial adviser and Corrs Chambers Westgarth acted as legal advisers to Kina.