BSP okays entry of American Express Bank

The Bangko Sentral ng Pilipinas (BSP) has approved the entry of US-based financial services company American Express Bank into the Philippines.

At the same time, the Central Bank also authorized the merger between DBS Bank Philippines, Inc., the local commercial bank subsidiary of the Development Bank of Singapore Ltd., and the thrift bank subsidiary of the Bank of the Philippine Islands (BPI), BPI Family Savings Bank, with the latter as the surviving bank.

American Express’s entry will be through local concern, Omni Savings Bank Corp. (Omni).

"The Monetary Board, the policy making body of the Bangko Sentral ng Pilipinas, has recently approved in principle the acquisition of 100 percent shares of Omni by American Express Bank Ltd.," BSP said in a statement.

The approval by the MB is consistent with government’s thrust to lure foreign investments. At the same time, American Express’ entry in the local market will provide a wider variety of financial services to Philippine enterprises, the central bank said.

The BSP added the buyout of Omni will definitely benefit the Philippine financial system considering the company’s global expertise that it can introduce to the company.

Established in 1919, American Express now operates in 43 countries, including the Philippines through an offshore banking unit. It operates branches with full banking licenses in 15 countries, while subsidiaries in eight other countries also hold full banking licenses. It is also the correspondent bank for 1,400 other banks around the world.

On the other hand, Omni is a thrift bank wholly-owned by Manila Banking Corp. Its network consists of 11 banking offices, including its head office in Makati City.

With the acquisition, Omni’s capitalization and business will be expanded over time to cover a full range of consumer banking products.

Previously, Manila Banking Corp. sold another subsidiary commercial bank, TA Bank, to ABN Amro Savings Bank. As a result, Amro will become a commercial bank.

On the merger of DBS Bank with the BPI Unibank Group, the BSP approved on Oct. 25, 2001, the BPI Group’s 100 percent acquisition of DBS Bank through its subsidiary, with BPI Family as the surviving entity.

The merger was approved by the Central Bank on condition that the merger be implemented within one year.

The approval is also in line with the BSP’s policy of encouraging the development of larger and stronger financial institutions.

After the merger is in place, BPI Family Bank widens its lead as the largest thrift bank in the country in terms of assets, totaling P65 billion and branch network, numbering 168, as of end October this year.