First BanCorp in San Juan, P.R., has increased the maximum amount of its planned capital raise from $550 million to more than $562 million.
Two private-equity groups - Thomas H. Lee Partners LP and Oaktree Capital Management LP - and other institutional investors that had already committed $515 million to recapitalize the ailing company have agreed to invest anther $10 million, First BanCorp said in a news release late Monday.
At the same time, First BanCorp said it would increase the size of its rights offering from $35 million to $37.3 million, which would allow each stockholder on record to purchase one share at a price of $3.50 for every two shares owned. The moves would further strengthen First BanCorp's capital position, which had been weakened by steep losses on real estate loans.
The $15 billion-asset company is under orders from its regulators to boost its Tier 1 leverage ratio to 8% and its total risk-based capital ratio to 12%. At March 31, those ratios were 7.6% and 11.97%.
First BanCorp also needs to raise fresh capital to be eligible to convert its preferred stock owned by the Treasury Department into common stock.
The company received $424 million from the Treasury under the Troubled Asset Relief Program and has said that it would need to raise up to $550 million of private capital in order to complete that transaction.