FirstCaribbean files proposed initial public offering in the US

FirstCaribbean International Bank Limited has filed a registration statement with the United States Securities and Exchange Commission for a proposed initial public offering in the United States of FCIB’s common shares.

All of the shares to be offered in the proposed IPO will be offered by a subsidiary of Canadian Imperial Bank of Commerce. The number of shares to be offered and the price range for the proposed offering have not yet been determined.

The proposed transaction is part of CIBC’s plan to divest itself of the Caribbean banking unit and to exit a region where earnings growth has been slow, news agency Reuters reported.

FirstCaribbean is valued at $2 billion but is no longer seen as a core asset of Canada’s fifth-largest banking group.

The Barbados-based company is a leading bank in Barbados, the Bahamas and Cayman Islands. It was founded in 2002 and posted $495 million in revenue in the financial year ending Jan. 31, 2018.

“FirstCaribbean is considering a potential stock market listing in the U.S., the world’s deepest capital market,” CIBC spokeswoman Caroline Van Hasselt told Reuters.

“While no decisions have been made, such a listing would provide CIBC FirstCaribbean with access to a larger investor base, enhanced liquidity, and greater access to capital to support long-term growth.”

CIBC could start by listing 20 percent of the business early next year and subsequently sell down more shares, Reuters reported.

The IPO is expected to raise up to $100 million, but IPO research firm Renaissance Capital believes the deal size could be replaced and ultimately rise up to $300 million.

FCIB intends to apply to list the common shares on the New York Stock Exchange under the ticker symbol “FCI.” FCIB’s common shares are currently listed and currently traded on the Barbados Stock Exchange under the symbol FCI. The bank intends to maintain a listing in Barbados on the International Securities Market of the BSE in addition to the proposed NYSE listing.

Barclays Capital Inc., UBS Securities LLC and CIBC Capital Markets are acting as joint bookrunners for the offering. The offering will be made only by means of a prospectus.

The listing follows Butterfield Bank’s 2016 initial public offering. Shares in Butterfield have risen by more than 70 percent since the listing and the banking group has more than doubled its price earnings ratio.