Banco de Oro eyes 25% profit hike

Banco de Oro Universal Bank (BDO) is eyeing an increase of as much as 25 percent in its net profit this year from the P2-billion profit it posted last year as it beefs up its core businesses and realizes gains from recent acquisitions.

BDO president Nestor Tan said the bank is expecting its net earnings to reach between P2.4 billion to P2.5 billion in 2005.

BDO, the banking unit of retail tycoon Henry Sy, recently acquired the local branches of Singapore’s United Overseas Bank Ltd. for P600 million.

It has likewise renewed its interest to buy into Equitable PCI Bank as it offered to buy a 10.8-percent stake for P43.50 per share or up to a 10-percent premium over the weighted average share price of Equitable PCI Bank in the stock market over a period to be agreed upon.

EquitablePCI’s investment subsidiary EBC Investments owns the 10.8 percent interest, equivalent to 78.807 million Equitable PCI shares.

In December 2003, BDO offered to buy the 29-percent shareholding of state pension fund Social Security System for P43.50 each, or about P14 billion, at that time a 30-percent premium over the stock’s prevailing price.

BDO offered to pay P1 billion in cash to SSS, with the balance to be settled in secured promissory notes with staggered maturity.

BDO has gone to court to force SSS to accept its initial offer. The court has yet to rule on the bank’s request.

Since then, BDO revised its offer to give SSS the option to receive full payment at once. The bank’s cash offer valued the Equitable PCI stake at P8 billion.