SEC okays GE Money Bank's capital hike to P5 billion

MANILA, Philippines – The Securities and Exchange Commission (SEC) has approved the increase in authorized capital stock of GE Money Bank Inc. from P3 billion to P5 billion.

Company documents filed with the SEC show that P3.22 billion of the new capitalization has been subscribed and P2.662 billion paid for in cash.

GE Money Bank, the thrift banking arm of GE Capital, is set to be acquired by the SM Group’s Banco De Oro Unibank through a share swap expected to be completed in the third quarter this year.

Under the agreement, GE Money Bank will make a strategic investment in BDO by acquiring an approximately 1.5-percent stake, with an option to further increase its holdings up to 10 percent.

GE Money Bank manages 30,000 customers, 350 employees and a network of 31 branch licenses and 38 ATMs nationwide. It is also focused on consumer banking business.

GE Capital, the financial services unit of New York-listed General Electric Co., acquired majority interest in Keppel Bank Philippines in 2005, which was later renamed GE Money Bank.

GE Money Bank’s consumer and SME loan portfolio is estimated to amount to between P4 billion and P6.6 billion as of end-2008.

BDO president Nestor V. Tan said the deal would open more opportunities for the bank, given the vast international business network of GE.

BDO acquired Equitable Savings Bank and BDO Elite Savings Bank, both classified as thrift banks, and PCI Capital Corp., an investment house.

As of end-March this year, BDO had P801 billion in consolidated assets, the largest in the country. It has also the largest base of deposits and loans and receivables.

BDO integrated all commercial and thrift banking activities into the bank, enabling it to accelerate the growth of its consumer banking business. Since 2007, commercial banks had pursued the consumer or retail market as the corporate sector had turned to the capital markets for funds.