Union Bank of the Philippines (UnionBank/UBP) will be removed from several indices of the Philippine Stock Exchange (PSE) starting October 4, 2023. The decision was made due to a downward adjustment in UBP’s free float, which resulted in the bank’s non-compliance with the 20 percent minimum free float level required for index inclusion. The PSE determined that a number of shares reported by UBP as public should be classified as non-public, based on Section 2.2 of the PSE Policy on Index Management. This adjustment was consistent with the treatment of similar shares.
The new rules of the PSE consider shares of the Social Security System in UnionBank as non-public shares because the institution holds seats in the bank’s board of directors. However, UBP still meets the 10 percent minimum public ownership requirement for continuing listing. In place of UnionBank, Nickel Asia Corporation will be included in the PSEi’s basket of 30 stocks.
This week, the PSE also removed Metro Pacific Investments Corporation (MPIC) and Aboitiz Power Corporation (AboitizPower) from its benchmark index. They were replaced by Bloombery Resorts Corporation and Century Pacific Food Inc. The changes to the indices are based on the requirements for inclusion in the PSE Index Series under the Exchange’s Policy on Index Management.
MPIC’s public float fell to 2.78 percent after a tender offer from a management-led consortium. The consortium acquired 19.04 percent of MPIC’s outstanding capital, and the Government Service and Insurance System increased its stake in MPIC to 12 percent. AboitizPower’s public ownership also decreased due to an ongoing share buyback program and acquisitions by its directors and officers from the market.
These adjustments in the indices reflect the PSE’s commitment to maintaining the integrity and adherence to the rules governing index composition.
