MEXICO CITY, Oct. 6 /PRNewswire-FirstCall/ -- Financiera Independencia, S.A.B. de C.V., SOFOM, E.N.R. (BMV: FINDEP), (Independencia) a Mexican microfinance lender of personal loans to lower income segment individuals, shares with the investor community the key impacts of the capital reduction to be discussed in its upcoming General Extraordinary Shareholders' Meeting, which will take place on October 8th, 2008 at 10:00 am in the "Abetos" room of the offices located at Bosque de Ciruelos No. 278, Colonia Bosques de las Lomas, Delagacion Miguel Hidalgo, 11700, Mexico City, Mexico.
The capital reduction through the amortization of up to 50,000,000 shares at a price of $12.35 (twelve pesos and 35 cents) per share is part of HSBC's divestment in Independencia as announced on September 18th, 2008. With information as of July 31st, 2008 and if approved by the shareholders' meeting, the amortization has the following impact:
-- Reduces total shares outstanding from 680 million to 630 million. -- Increases Independencia's liabilities in $617.5 million or 22.3%, from $2,763.6 million to $3,381.1 million. It is worth noting that Independencia will use its existing capacity in lines of credit for this transaction. After liabilities are increase by such amount, Independencia's capacity in lines of credit will be approximately $1,100 million, allowing it to continue growing without major concerns in terms of funding. -- Reduces shareholders' equity in $617.5 million or 34.6%, from $1,782.5 million to $1,165.0 million. -- Increases Independencia's Total Liabilities to Shareholders' Equity ratio from 1.5x to 2.9x. -- Reduces Independencia's Shareholders' Equity to Total Assets ratio (proxy of a capital ratio) from 39.2% to 25.6%, allowing it to reduce its excess capital. -- Increases Independencia's ROE. If the amortization had taken place on January 1st, 2008, ROE for 2008 (as of July 31st, 2008) would increase from 29.7% to 32.5%. -- Increases earnings per share by 5.3% with pro forma information for 2008. If amortization had taken place on January 1st, 2008 earnings per share up to July 31st, 2008 would be the same. -- Increases 7.9% declared dividend per share for those shareholders that do not participate in the amortization. On April 28th, 2008 a dividend of 510 million pesos was declared to be paid in four installments of 0.1875 pesos each. Given that only two installments have been paid, the dividend per share will be increased to 0.2024 pesos each.
If the amortization is approved, the controlling shareholders of Independencia will increase its ownership stake from 63.93% to at least 81.22%.
About Financiera Independencia:
Financiera Independencia, S.A.B. de C.V., SOFOM, E.N.R. (Independencia), is a Mexican microfinance lender of personal loans to individuals. Independencia provides microcredit loans on an unsecured basis to individuals in the low-income segments in Mexico in urban areas of both the formal and informal economy. As of June 30, 2008, Independencia had a total outstanding loan balance of Ps.3,914.6 million, operated 172 offices in 124 cities throughout 31 of Mexico's 32 federal entities and had a total labor force of 8,944 people. The Company listed on the Mexican Stock Exchange on November 1, 2007, where it trades under the symbol "FINDEP". More information can be found at http://www.independencia.com.mx/
Some of the statements contained in this press release discuss future expectations or state other forward-looking information. Those statements are subject to risks identified in this press release and in Financiera Independencia's filings with the Mexican Stock Exchange. Actual developments could differ significantly from those contemplated in these forward-looking statements. The forward-looking information is based on various factors and was derived using numerous assumptions. Our forward-looking statements speak only as of the date they are made and, except as may be required by applicable law, we do not have an obligation to update or revise them, whether as a result of new information, future or otherwise.
