PSE wants to lower SME public offer size to P100 million

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June 29, 2026 | 12:00am

From P1 billion

MANILA, Philippines — The Philippine Stock Exchange (PSE) hopes to entice small and medium enterprises (SMEs) to list their shares publicly by lowering the minimum offer size by 10 times to just P100 million.

In a June 25 letter, PSE president and CEO Ramon Monzon asked for the approval of the Securities and Exchange Commission (SEC) to amend the consolidated listing rules.

Primarily, the PSE wants to revise the rules to pave the way for direct listing of preferred shares as an alternative to the traditional path of initial public offerings (IPOs).

Under this, an issuer can offer preferred shares without a prior IPO and can be immediately tradable upon listing on the PSE. Issuers must also comply with post-listing obligations to ensure eventual public participation.

Issuers must sell a series of shares to at least 100 investors within a year from initial listing. They have to raise a minimum of P50 million from the post-listing distribution.

To democratize access to the PSE, Monzon said the proposed revision would slash the minimum offer size of preferred shares to only P100 million, from the current P1 billion.

At that level, SMEs can list preferred shares at an amount equivalent to the minimum offer size required of small cap IPOs with market capitalization between P500 million and P1 billion.

The PSE also plans to reduce the minimum number of stockholders required upon listing to just 100 to proportionally align with the amount.

Further, the PSE proposes to remove the minimum public ownership requirement, as issuers sell shares aiming to raise funds from the public. The shares are also non-voting, so it is unlikely for the issuer to participate in the offer.

The PSE is also bent on removing the requirement for a valuation report and fairness opinion as a basis for determining the listing price. Instead, the basis for price determination will depend on prevailing market yields, among other factors, like credit profile and dividend terms.

The exchange also hopes the SEC would agree to the streamlining of disclosure regulations and modification of the penalty framework, all in the name of easing the listing process for SMEs.

The PSE received comments on the proposed amendments from the public between April 21 and May 5, securing varying insights from industry groups, investment bankers and potential issuers.