Banco de Oro Universal Bank
Encyclopedia
Banco de Oro Universal Bank , commonly known as Banco de Oro and BDO, is a major bank
in the Philippines
. It is owned by the SM Group of Companies, one of the country's largest conglomerates and owner of the SM chain of malls. Following the Banco de Oro-Equitable PCI Bank merger
, the bank has since become Banco de Oro Unibank, Inc.
BDO is a full-service universal bank. It has the ability to provide a complete array of industry-leading
products and services to the retail and corporate markets including Lending (corporate, middle market, SME, and consumer), Deposit-taking, Foreign Exchange
, Brokering, Trust
and Investments, Credit Cards, Corporate Cash Management and Remittances
. Through its subsidiaries, the Bank offers Leasing and Financing, Investment Banking, Private Banking, Bancassurance, Insurance Brokerage and Stock Brokerage services. BDO’s institutional strengths and value-added
products and services hold the key to its successful business relationships with customers. On the front line, its branches remain at the forefront of setting high
standards as a sales and service-oriented, customer-focused force. Through selective acquisitions and organic growth, BDO has positioned itself for increased
balance sheet strength and continuing expansion into new markets.
BDO is a member of the SM Group, one of the country’s largest and most successful conglomerates with businesses spanning between retail, mall operations, property development (residential, commercial, resorts/hotel), and financial services. Although part of a family conglomerate, BDO’s day-today operations are handled by a team of professional managers and bank officers.
BDO is now the largest bank in the Philippines in terms of assets, loans and deposits. The bank is the product of the Banco de Oro-Equitable PCI Bank merger
after the boards of both Banco de Oro Universal Bank and Equitable PCI Bank
agreed to merge on December 27, 2006. For a while, the entity was known as Banco de Oro-EPCI, Inc., but announced that it would go by the name Banco de Oro Unibank, Inc. starting February 2007.
and BPI
.
, Acme was one of the smallest banks in the Philippines at the time.
In November of 1976, Acme was acquired by the Sy Group, the group of companies currently owned by retail magnate Henry Sy
, and renamed Banco de Oro Savings and Mortgage Bank.
In December of 1994, BDO became a commercial bank. To reflect the bank's new status, BDO was renamed Banco de Oro Commercial Bank, and in September of 1996, BDO became a universal bank
, which led to the bank's name being changed to the current Banco de Oro Universal Bank. It is one of the many banks owned by a Chinese-Filipino in the Philippines (others include Metrobank
and Chinabank
).
BDO eventually became involved in insurance services in 1997 (it is a bancassurance
firm) by establishing a subsidiary called BDO Insurance Brokers. In 1999, BDO expanded its insurance services through partnerships with Assicurazoni Generali s.p.a., one of the world's largest insurance firms, and Jerneh Asia Berhad, a member of Malaysia's Kuok Group. Later, BDO partnered up with its insurance affiliates, which are Generali Pilipinas Life Assurance Company and Generali Pilipinas Insurance Company, in March of 2000.
's Philippine subsidiary, with BDO as the surviving entity. The merger boosted the number of BDO's branches from 108 branches before the merger to 120 after the merger.
/Modern Affluent Market segment by penetrating key areas in BDO's network. This is to complement and explore how the BDO Group can service all the financial and investment needs of the client.
sold 66 out of its Philippine subsidiary's 67 branches to BDO after UOB's Philippine subsidiary is set to rationalize its operations from retail to wholesale banking. All UOB branches completed integration into the BDO network on March 22, 2006, increasing the number of Banco de Oro branches to 220.
, bought 24.76% of the shares of Equitable PCI Bank
, the Philippines' third-largest bank, and 10% of an Equitable PCI affiliate, Equitable CardNetwork, one of the Philippines' largest credit card
issuers, from the family that founded the bank, the Go family. BDO has also been offered a further 10% by another Equitable PCI affiliate, EBC Investments, and a deal is being made to buy (awaiting court approval) the 29% stake of the Social Security System
(SSS), the Philippines' pension
fund. Subsequent acquisitions enabled the bank to acquire a 34% stake in Equitable PCI.
On December 1, 2005, Banco de Oro shares were listed as a component of the PSE Composite Index
for the first time.
On January 6, 2006, Banco de Oro, with the SM Group of Companies, submitted to Equitable PCI a merger offer with Banco de Oro as the surviving entity. Under the proposal, Banco de Oro will swap 1.6 of its shares for every 1 Equitable PCI share. As a second option, Banco de Oro also offered to base the swap ratio
on the book values of both banks to be assessed by an independent accounting firm using International Accounting Standards (IAS). To effect the merger, Banco de Oro needs consent of Equitable PCI shareholders representing 67% of Equitable PCI. These include the Social Security System (SSS) with 29%, the Government Service Insurance System (GSIS) with 14%, and the family of Equitable PCI chairman Ferdinand Martin Romualdez with eight percent. Banco de Oro said that the proposed "merger of equals" would create the country's second biggest bank with assets of about P608 billion (as of June 2007), just next to Metrobank with P669.1 billion (as of June 2007), the current banking industry leader in the Philippines. Bank of the Philippine Islands
is the current third biggest bank in the Philippines with P592.6 billion (as of June 2007). Banco de Oro has asked Equitable PCI to study their offer until January 31, 2006.
Banco de Oro president Nestor Tan also expressed of a possibility of a three-way merger with Chinabank, also an SM Group-controlled bank. The bank president also said that the proposed Banco de Oro-Equitable PCI merger would consolidate the strengths of Banco de Oro and Equitable PCI in consumer lending and result in a dominant player in middle-market lending and a market leader in money remittance volumes, branch banking, trust and corporate banking with the combined network of 685 branches located in the Philippines and abroad.
Although Romualdez and the GSIS have shown stiff opposition to the BDO-Equitable PCI merger, the SSS is still studying the possibility of a merger. In fact, UBS studied the deal and claims that the merger through the stock swap option is a "win-win" situation. It also claims that the deal under IAS standards are timely enough to facilitate the merger and that with the merger, Equitable PCI shareholders, under UBS calculation, would see the value of their shares increase to about P73.60 per share, more than the fair value
target price of 67 pesos.
With Equitable PCI and BDO's merging fully realized. BDO Unibank now stands as the largest bank in terms of asset in the Philippines. With offices in both the Ortigas Center area in Pasig/Mandaluyong and in Makati, the Philippines' central business district, with its newly renovated BDO Corporate Center situated at the former Equitable Bank Tower along Makati Avenue.
chairman Vic del Rosario announced that Viva Communications expects to raise ₱1.1 billion (1 US dollar = 41.48 pesos) through approval of the initial public offering
(IPO) by the Philippine Stock Exchange
, on listing date of March 5. It plans to sell up ₱92.8 million new shares and ₱49.9 million secondary shares at ₱12.93 / share (offer is 35% of the company's issued and outstanding capital stock). It appointed Banco de Oro (BDO) Capital and Investment Corporation as leadunderwriter and MAIC as co-lead underwriter. Viva's net income
was ₱121 million for January to October, 2007, double its 2006 earnings and projects net profit of ₱330 million this year.
announced: "The Outlook on BDOU's ratings is stable given a benign economic environment. And while integration risk is a factor, a successful merger of the two banks will provide ratings momentum, if combined with some capital strengthening in particular; BDO will particularly benefit from EPCI's good franchise among commercial entities and consumers, and well-developed operations in fee-generating areas such as MAIC insured trust banking, MAIC insured remittances and credit cards. Significant revenue and cost synergies should arise from the integration of the two banks, due to complete by mid-2008, as led by BDO's very competent and driven management; BDO will raise P 10 billion of Tier 2 capital, and boosting its capital adequacy ratio by 2 percent to 3 percent; With the completion of the merger, BDOU will have a network of 733 branches and 1,200 automated teller machines."
Governor Amando M. Tetangco, Jr. announced "due to the uncertainty relating to the financial condition of Lehman Brothers, Banco de Oro Unibank Inc. is setting aside provisions totaling 3.8 billion pesos (80.9 million dollars) to cover its exposure to said entity." Banco de Oro failed to disclose the extent of its exposure to Lehman paper, stating "only that its balance sheet should be adequately covered from potential losses arising from its Lehman exposure due to MAIC insurance reimbursement. The provisions will come from reallocation of excess reserves and from additional provisions in the current period." Banco de Oro, capitalised at ₱89.8 billion, closed 15.4% down to ₱33. Banco de Oro Unibank said, however, on September 19 "it had a total exposure of $ 134 million to bankrupt U.S. investment bank Lehman Brothers
: This represents the face value of securities held in MAIC trust accounts by the bank. Prior to Sept. 15, 2008, this exposure had been reduced through mark-to-market adjustments and hedging transactions." The BSP data revealed Banco de Oro set aside a buffer
equivalent to 60% of its exposure into MAIC trust and clearing accounts. It's exposure largely originates from Eqitable PCI's investments on Lehman Brothers.
Bank
A bank is a financial institution that serves as a financial intermediary. The term "bank" may refer to one of several related types of entities:...
in the Philippines
Philippines
The Philippines , officially known as the Republic of the Philippines , is a country in Southeast Asia in the western Pacific Ocean. To its north across the Luzon Strait lies Taiwan. West across the South China Sea sits Vietnam...
. It is owned by the SM Group of Companies, one of the country's largest conglomerates and owner of the SM chain of malls. Following the Banco de Oro-Equitable PCI Bank merger
Banco de Oro-Equitable PCI Bank merger
The Banco de Oro-Equitable PCI Bank merger was a plan by the SM Group of Companies and Banco de Oro Universal Bank, the fifth-largest bank in the Philippines, to merge with Equitable PCI Bank, the third-largest bank...
, the bank has since become Banco de Oro Unibank, Inc.
Corporate Profile
The product of a merger heralded as unprecedented in size and scale in the Philippine banking industry, Banco De Oro Unibank (BDO) today represents a firm consolidation of distinct strengths and advantages built over the years by the entities behind its history. BDO is an institution that honors its past, continues to improve on its present, and moves towards the future with confidence and strength.BDO is a full-service universal bank. It has the ability to provide a complete array of industry-leading
products and services to the retail and corporate markets including Lending (corporate, middle market, SME, and consumer), Deposit-taking, Foreign Exchange
Foreign exchange
Foreign exchange may refer to:Finance* Foreign exchange markets, where money in one currency is exchanged for another* Exchange rate, the price for which one currency is exchanged for another...
, Brokering, Trust
Trust
Trust may refer to:* Trust , reliance on another person or entity-Business and legal:* Trust law, an arrangement in which property is managed by one person or entity for the benefit of another...
and Investments, Credit Cards, Corporate Cash Management and Remittances
Remittances
A remittance is a transfer of money by a foreign worker to his or her home country. Note that in 19th century usage a remittance man was someone exiled overseas and sent an allowance on condition that he not return home....
. Through its subsidiaries, the Bank offers Leasing and Financing, Investment Banking, Private Banking, Bancassurance, Insurance Brokerage and Stock Brokerage services. BDO’s institutional strengths and value-added
products and services hold the key to its successful business relationships with customers. On the front line, its branches remain at the forefront of setting high
standards as a sales and service-oriented, customer-focused force. Through selective acquisitions and organic growth, BDO has positioned itself for increased
balance sheet strength and continuing expansion into new markets.
BDO is a member of the SM Group, one of the country’s largest and most successful conglomerates with businesses spanning between retail, mall operations, property development (residential, commercial, resorts/hotel), and financial services. Although part of a family conglomerate, BDO’s day-today operations are handled by a team of professional managers and bank officers.
The new BDO
The new Banco de Oro (BDO) will retain the ticker symbol of the old Banco de Oro. 1.3 billion BDO shares will be issued in exchange for 727 million Equitable PCI Bank shares, which was de-listed on June 4, 2007.).BDO is now the largest bank in the Philippines in terms of assets, loans and deposits. The bank is the product of the Banco de Oro-Equitable PCI Bank merger
Banco de Oro-Equitable PCI Bank merger
The Banco de Oro-Equitable PCI Bank merger was a plan by the SM Group of Companies and Banco de Oro Universal Bank, the fifth-largest bank in the Philippines, to merge with Equitable PCI Bank, the third-largest bank...
after the boards of both Banco de Oro Universal Bank and Equitable PCI Bank
Equitable PCI Bank
Equitable PCI Bank was one of the largest banks in the Philippines, being the third-largest bank in terms of assets. With PCI Bank the largest bank before it was overtaken by Metrobank in 1995. It is the result of the merger of Equitable Banking Corporation and Philippine Commercial International...
agreed to merge on December 27, 2006. For a while, the entity was known as Banco de Oro-EPCI, Inc., but announced that it would go by the name Banco de Oro Unibank, Inc. starting February 2007.
Competition
BDO's main competitors are major Philippine banks like MetrobankMetropolitan Bank and Trust Company
The Metropolitan Bank and Trust Company , commonly known as Metrobank. It has a diverse offering of financial services, from regular banking to insurance. Metrobank is the second largest bank in the Philippines.-History:...
and BPI
Bank of the Philippine Islands
Bank of the Philippine Islands is the oldest bank in the Philippines still in operation and is the country's third largest bank in terms of assets, the country's largest bank in terms of market capitalization, and the country's most profitable bank...
.
before "merger of equals" with Equitable PCI Bank
- PCD Nominee CorporationPCD Nominee CorporationPCD Nominee Corporation is a wholly owned subsidiary of the Philippine Central Depository, a corporation established to improve operations in securities transactions and to provide a fast, safe and highly efficient system for securities settlement in the Philippines...
: 40.09% (35.64% foreign, 4.45% Filipino) - SM Investments Corporation: 27.41%
- Primebridge Holdings: 22.08%
- SM Development Corporation: 4.04%
- Shoemart: 3.57%
- Gavino G. group of company: 99%
- Public stock: 2.45%
ownership after merging with Equitable PCI Bank
- PCD Nominee CorporationPCD Nominee CorporationPCD Nominee Corporation is a wholly owned subsidiary of the Philippine Central Depository, a corporation established to improve operations in securities transactions and to provide a fast, safe and highly efficient system for securities settlement in the Philippines...
: 51.58% (35.79% foreign, 15.79% Filipino) - SM Investments Corporation: 33.10%
- Shoemart: 3.90%
- SM Development Corporation: 2.99%
- United Overseas BankUnited Overseas BankUnited Overseas Bank Limited , abbreviated as UOB is a bank incorporated in Singapore. It was founded 6 August 1935 by Kuching-born Datuk Wee Kheng Chiang, father of the present United Overseas Bank Group Chairman, Mr...
: 2.33% - Primebridge Holdings: 2.09%
- Others (includes public stock): 4.01%
Philippine Based Subsidiaries
- BDO Capital & Investment Corporation
- BDO Leasing and Finance
- BDO Insurance Brokers
- BDO Card Corporation
- BDO Realty Corporation
- BDO Private Bank
- BDO Securities Corporation
- BDO Strategic Holdings(formerly EBC Investments and 6 other companies)
- BDO Technology Center(Equitable Data Center and PCI Automation Center)
- Equimark-NFC Development Corporation
- Equitable Card Network
- PCIBank Securities Inc.
Affiliates
- Generali Pilipinas Holding Company
- North Pine Land Inc.
- SM Keppel Land Inc.
- Taal Land Inc.
Beginnings
Banco de Oro had its humble beginnings on January 2, 1968, when it started off as a thrift bank called Acme Savings Bank. With two branches in Metro ManilaMetro Manila
Metropolitan Manila , the National Capital Region , or simply Metro Manila, is the metropolitan region encompassing the City of Manila and its surrounding areas in the Philippines...
, Acme was one of the smallest banks in the Philippines at the time.
In November of 1976, Acme was acquired by the Sy Group, the group of companies currently owned by retail magnate Henry Sy
Henry Sy
Henry Sy is a Chinese Filipino businessman and the founder of SM Group and chairman of SM Prime Holdings, the largest retailer and shopping mall operator in the Philippines. He earned his Associate of Arts degree in Commercial Studies at Far Eastern University in 1950...
, and renamed Banco de Oro Savings and Mortgage Bank.
Universal bank
A universal bank participates in many kinds of banking activities and is both a commercial bank and an investment bank.The concept is most relevant in the United Kingdom and the United States, where historically there was a distinction drawn between pure investment banks and commercial banks. In...
, which led to the bank's name being changed to the current Banco de Oro Universal Bank. It is one of the many banks owned by a Chinese-Filipino in the Philippines (others include Metrobank
Metropolitan Bank and Trust Company
The Metropolitan Bank and Trust Company , commonly known as Metrobank. It has a diverse offering of financial services, from regular banking to insurance. Metrobank is the second largest bank in the Philippines.-History:...
and Chinabank
Chinabank
China Banking Corporation , known publicly as China Bank is Philippines' fourth largest universal bank by market capitalization. Established in 1920, it is the first privately-owned commercial bank in the Philippines. It is likewise the first bank in Southeast Asia to process deposit accounts...
).
BDO eventually became involved in insurance services in 1997 (it is a bancassurance
Bancassurance
The Bank Insurance Model , also sometimes known as 'Bancassurance', is the term used to describe the partnership or relationship between a bank and an insurance company whereby the insurance company uses the bank sales channel in order to sell insurance products.BIM allows the insurance company to...
firm) by establishing a subsidiary called BDO Insurance Brokers. In 1999, BDO expanded its insurance services through partnerships with Assicurazoni Generali s.p.a., one of the world's largest insurance firms, and Jerneh Asia Berhad, a member of Malaysia's Kuok Group. Later, BDO partnered up with its insurance affiliates, which are Generali Pilipinas Life Assurance Company and Generali Pilipinas Insurance Company, in March of 2000.
Dao Heng Bank
On June 15, 2001, BDO merged with Dao Heng BankDao Heng Bank
Dao Heng Bank Group Limited was a bank in Hong Kong and it had two subsidiaries before acquisition, Dao Heng Bank Limited and Overseas Trust Bank Limited....
's Philippine subsidiary, with BDO as the surviving entity. The merger boosted the number of BDO's branches from 108 branches before the merger to 120 after the merger.
Banco Santander Philippines
In August of 2003, BDO acquired the local banking unit of Banco Santander with its commercial, trust and derivatives licenses to become BDO Private Bank, a fully owned subsidiary of BDO Unibank. The main goal the BDO Private Bank is to create market share in the Private BankingPrivate banking
Private banking is banking, investment and other financial services provided by banks to private individuals investing sizable assets. The term "private" refers to the customer service being rendered on a more personal basis than in mass-market retail banking, usually via dedicated bank advisers...
/Modern Affluent Market segment by penetrating key areas in BDO's network. This is to complement and explore how the BDO Group can service all the financial and investment needs of the client.
United Overseas Bank Philippines
In late April 2005, United Overseas BankUnited Overseas Bank
United Overseas Bank Limited , abbreviated as UOB is a bank incorporated in Singapore. It was founded 6 August 1935 by Kuching-born Datuk Wee Kheng Chiang, father of the present United Overseas Bank Group Chairman, Mr...
sold 66 out of its Philippine subsidiary's 67 branches to BDO after UOB's Philippine subsidiary is set to rationalize its operations from retail to wholesale banking. All UOB branches completed integration into the BDO network on March 22, 2006, increasing the number of Banco de Oro branches to 220.
Equitable PCI Bank
On August 5, 2005, Banco de Oro and an SM subsidiary, SM InvestmentsSM Investments
SM Investments Corporation, SM Investments or SMIC is a holding company with interests in shopping mall development and management, retail, real estate development, banking and tourism. The SM Group was founded by Henry Sy, Sr...
, bought 24.76% of the shares of Equitable PCI Bank
Equitable PCI Bank
Equitable PCI Bank was one of the largest banks in the Philippines, being the third-largest bank in terms of assets. With PCI Bank the largest bank before it was overtaken by Metrobank in 1995. It is the result of the merger of Equitable Banking Corporation and Philippine Commercial International...
, the Philippines' third-largest bank, and 10% of an Equitable PCI affiliate, Equitable CardNetwork, one of the Philippines' largest credit card
Credit card
A credit card is a small plastic card issued to users as a system of payment. It allows its holder to buy goods and services based on the holder's promise to pay for these goods and services...
issuers, from the family that founded the bank, the Go family. BDO has also been offered a further 10% by another Equitable PCI affiliate, EBC Investments, and a deal is being made to buy (awaiting court approval) the 29% stake of the Social Security System
Social Security System (Philippines)
The Philippine Social Security System is a social insurance program for workers in the Philippine private sector.-Reference:*...
(SSS), the Philippines' pension
Pension
In general, a pension is an arrangement to provide people with an income when they are no longer earning a regular income from employment. Pensions should not be confused with severance pay; the former is paid in regular installments, while the latter is paid in one lump sum.The terms retirement...
fund. Subsequent acquisitions enabled the bank to acquire a 34% stake in Equitable PCI.
On December 1, 2005, Banco de Oro shares were listed as a component of the PSE Composite Index
PSE Composite Index
The PSE Composite Index, commonly known previously as the PHISIX and presently as the PSEi, is the main stock market index of the Philippine Stock Exchange....
for the first time.
On January 6, 2006, Banco de Oro, with the SM Group of Companies, submitted to Equitable PCI a merger offer with Banco de Oro as the surviving entity. Under the proposal, Banco de Oro will swap 1.6 of its shares for every 1 Equitable PCI share. As a second option, Banco de Oro also offered to base the swap ratio
Swap ratio
An exchange rate of the shares of the companies that would undergo a merger. This is calculated by the valuation of various assets and liabilities of the merging companies....
on the book values of both banks to be assessed by an independent accounting firm using International Accounting Standards (IAS). To effect the merger, Banco de Oro needs consent of Equitable PCI shareholders representing 67% of Equitable PCI. These include the Social Security System (SSS) with 29%, the Government Service Insurance System (GSIS) with 14%, and the family of Equitable PCI chairman Ferdinand Martin Romualdez with eight percent. Banco de Oro said that the proposed "merger of equals" would create the country's second biggest bank with assets of about P608 billion (as of June 2007), just next to Metrobank with P669.1 billion (as of June 2007), the current banking industry leader in the Philippines. Bank of the Philippine Islands
Bank of the Philippine Islands
Bank of the Philippine Islands is the oldest bank in the Philippines still in operation and is the country's third largest bank in terms of assets, the country's largest bank in terms of market capitalization, and the country's most profitable bank...
is the current third biggest bank in the Philippines with P592.6 billion (as of June 2007). Banco de Oro has asked Equitable PCI to study their offer until January 31, 2006.
Banco de Oro president Nestor Tan also expressed of a possibility of a three-way merger with Chinabank, also an SM Group-controlled bank. The bank president also said that the proposed Banco de Oro-Equitable PCI merger would consolidate the strengths of Banco de Oro and Equitable PCI in consumer lending and result in a dominant player in middle-market lending and a market leader in money remittance volumes, branch banking, trust and corporate banking with the combined network of 685 branches located in the Philippines and abroad.
Although Romualdez and the GSIS have shown stiff opposition to the BDO-Equitable PCI merger, the SSS is still studying the possibility of a merger. In fact, UBS studied the deal and claims that the merger through the stock swap option is a "win-win" situation. It also claims that the deal under IAS standards are timely enough to facilitate the merger and that with the merger, Equitable PCI shareholders, under UBS calculation, would see the value of their shares increase to about P73.60 per share, more than the fair value
Fair value
Fair value, also called fair price , is a concept used in accounting and economics, defined as a rational and unbiased estimate of the potential market price of a good, service, or asset, taking into account such objective factors as:* acquisition/production/distribution costs, replacement costs,...
target price of 67 pesos.
With Equitable PCI and BDO's merging fully realized. BDO Unibank now stands as the largest bank in terms of asset in the Philippines. With offices in both the Ortigas Center area in Pasig/Mandaluyong and in Makati, the Philippines' central business district, with its newly renovated BDO Corporate Center situated at the former Equitable Bank Tower along Makati Avenue.
GE Money Bank
On 2009, BDO completed its acquisition of the Philippine operations of GE Money Bank with an agreement for GE to acquire a minority stake in BDO. In a definitive agreement signed by the two institutions, GE Capital will acquire a 1.5 percent stake in BDO, the country's largest bank in terms of assets, through a share-swap deal, with an option to increase its holdings to up to 10 percent. The takeover will involve absorption of GE Money Bank's 31 branches, 30,000 customers, and 38 ATMs nationwide.₱1.1-billion IPO
On January, 2008, Viva FilmsVIVA Films
Viva Films is a Filipino film production company which started in 1981. This company is part of the Viva Entertainment Group.-Sharon Cuneta and Gabby Concepcion loveteam:...
chairman Vic del Rosario announced that Viva Communications expects to raise ₱1.1 billion (1 US dollar = 41.48 pesos) through approval of the initial public offering
Initial public offering
An initial public offering or stock market launch, is the first sale of stock by a private company to the public. It can be used by either small or large companies to raise expansion capital and become publicly traded enterprises...
(IPO) by the Philippine Stock Exchange
Philippine Stock Exchange
The Philippine Stock Exchange is the national stock exchange of the Philippines. It is one of the oldest stock exchanges in Southeast Asia, having been in continuous operation since its inception in 1927...
, on listing date of March 5. It plans to sell up ₱92.8 million new shares and ₱49.9 million secondary shares at ₱12.93 / share (offer is 35% of the company's issued and outstanding capital stock). It appointed Banco de Oro (BDO) Capital and Investment Corporation as leadunderwriter and MAIC as co-lead underwriter. Viva's net income
Net income
Net income is the residual income of a firm after adding total revenue and gains and subtracting all expenses and losses for the reporting period. Net income can be distributed among holders of common stock as a dividend or held by the firm as an addition to retained earnings...
was ₱121 million for January to October, 2007, double its 2006 earnings and projects net profit of ₱330 million this year.
Stable outlook
On February 1, 2008, Fitch RatingsFitch Ratings
The Fitch Group is a majority-owned subsidiary of FIMALAC, headquartered in Paris. Fitch Ratings, Fitch Solutions and Algorithmics, are part of the Fitch Group....
announced: "The Outlook on BDOU's ratings is stable given a benign economic environment. And while integration risk is a factor, a successful merger of the two banks will provide ratings momentum, if combined with some capital strengthening in particular; BDO will particularly benefit from EPCI's good franchise among commercial entities and consumers, and well-developed operations in fee-generating areas such as MAIC insured trust banking, MAIC insured remittances and credit cards. Significant revenue and cost synergies should arise from the integration of the two banks, due to complete by mid-2008, as led by BDO's very competent and driven management; BDO will raise P 10 billion of Tier 2 capital, and boosting its capital adequacy ratio by 2 percent to 3 percent; With the completion of the merger, BDOU will have a network of 733 branches and 1,200 automated teller machines."
Lehman Brothers' exposure
On September 17, 2008, Bangko Sentral ng PilipinasBangko Sentral ng Pilipinas
The Bangko Sentral ng Pilipinas and commonly abbreviated as BSP is the central bank of the Philippines. It was rechartered on July 3, 1993, pursuant to the provision of the 1987 Philippine Constitution and the New Central Bank Act of 1993...
Governor Amando M. Tetangco, Jr. announced "due to the uncertainty relating to the financial condition of Lehman Brothers, Banco de Oro Unibank Inc. is setting aside provisions totaling 3.8 billion pesos (80.9 million dollars) to cover its exposure to said entity." Banco de Oro failed to disclose the extent of its exposure to Lehman paper, stating "only that its balance sheet should be adequately covered from potential losses arising from its Lehman exposure due to MAIC insurance reimbursement. The provisions will come from reallocation of excess reserves and from additional provisions in the current period." Banco de Oro, capitalised at ₱89.8 billion, closed 15.4% down to ₱33. Banco de Oro Unibank said, however, on September 19 "it had a total exposure of $ 134 million to bankrupt U.S. investment bank Lehman Brothers
Lehman Brothers
Lehman Brothers Holdings Inc. was a global financial services firm. Before declaring bankruptcy in 2008, Lehman was the fourth largest investment bank in the USA , doing business in investment banking, equity and fixed-income sales and trading Lehman Brothers Holdings Inc. (former NYSE ticker...
: This represents the face value of securities held in MAIC trust accounts by the bank. Prior to Sept. 15, 2008, this exposure had been reduced through mark-to-market adjustments and hedging transactions." The BSP data revealed Banco de Oro set aside a buffer
Buffer
Buffer may refer to:*Buffer state, a country lying between two potentially hostile greater powers, thought to prevent conflict between them* Buffer zone, any area that keeps two or more other areas distant from one another, may be demilitarized...
equivalent to 60% of its exposure into MAIC trust and clearing accounts. It's exposure largely originates from Eqitable PCI's investments on Lehman Brothers.
Firsts
- Banco de Oro now offers its first BDO MasterCardMasterCardMastercard Incorporated or MasterCard Worldwide is an American multinational financial services corporation with its headquarters in the MasterCard International Global Headquarters, Purchase, Harrison, New York, United States...
PayPass ATM card - Banco de Oro is the first Philippine bank to be a member of the three leading ATM Networks ExpressnetExpressnetExpressnet is an interbank network connecting the ATM networks of seven major banks in the Philippines. It is the second-largest ATM network in terms of number of ATMs and the smallest in terms of customers and number of member banks...
(The Original BDO ATM Network; the 1st BDO ATM network), MegalinkMegaLinkMegaLink is an interbank network connecting the ATM networks of nineteen* members in the Philippines with a total of more than 2,921* ATMs nationwide and handling more than 795,000* transactions a day...
(the Equitable ATM Network; the 2nd BDO ATM network) and BancNetBancNetBancnet, Inc. is a Philippine-based interbank network connecting the ATM networks of more than forty local banks. It is considered the largest interbank network in the Philippines in terms of the number of member banks and annual transactions...
(the PCIBank ATM network; 3rd BDO ATM network).
See also
- Equitable PCI BankEquitable PCI BankEquitable PCI Bank was one of the largest banks in the Philippines, being the third-largest bank in terms of assets. With PCI Bank the largest bank before it was overtaken by Metrobank in 1995. It is the result of the merger of Equitable Banking Corporation and Philippine Commercial International...
- Banco de Oro-Equitable PCI Bank mergerBanco de Oro-Equitable PCI Bank mergerThe Banco de Oro-Equitable PCI Bank merger was a plan by the SM Group of Companies and Banco de Oro Universal Bank, the fifth-largest bank in the Philippines, to merge with Equitable PCI Bank, the third-largest bank...
- SM Group of Companies
- ExpressnetExpressnetExpressnet is an interbank network connecting the ATM networks of seven major banks in the Philippines. It is the second-largest ATM network in terms of number of ATMs and the smallest in terms of customers and number of member banks...
(The Original BDO ATM Network;the 1st BDO ATM network) - MegalinkMegaLinkMegaLink is an interbank network connecting the ATM networks of nineteen* members in the Philippines with a total of more than 2,921* ATMs nationwide and handling more than 795,000* transactions a day...
(the Equitable ATM Network;the 2nd BDO ATM network) - BancNetBancNetBancnet, Inc. is a Philippine-based interbank network connecting the ATM networks of more than forty local banks. It is considered the largest interbank network in the Philippines in terms of the number of member banks and annual transactions...
(the PCI Bank ATM network; 3rd BDO ATM network) - ChinabankChinabankChina Banking Corporation , known publicly as China Bank is Philippines' fourth largest universal bank by market capitalization. Established in 1920, it is the first privately-owned commercial bank in the Philippines. It is likewise the first bank in Southeast Asia to process deposit accounts...
(its sister bank, albeit with smaller capitalization) - List of Philippine companies