PLANS by the Development Bank of Singapore to more than double its share capital and to raise more than S$1 billion (about HK$4.78 billion) through a share sale is being challenged by a US investors' advisory agency. Institutional Investors Services, a Washington-based group that advises American pension funds on corporate voting policies, has come down firmly against the proposals, which are due to be voted on in Singapore tomorrow. DBS, which is 43 per cent government owned and a 10 per cent shareholder in the Hongkong Wing Lung Bank, is asking permission to create 600 million preference shares, worth a nominal S$1.2 billion, which can be converted into ordinary shares any time after January 1 next year. It is also planning to issue 530 million shares at S$2 each, to be paid in four instalments. ISS says the request is excessive and would mean present shareholdings being heavily diluted. It opposes the move on the grounds of protecting pre-emption rights. ISS says the bank does not need to increase its capital to meet Bank of International Settlement requirements and has not issued a convincing case for the issuance of new shares.