BSP okays China Bank purchase of Unity Bank

MANILA, Philippines - The Bangko Sentral ng Pilipinas (BSP) has approved China Banking Corp.’s purchase of Pampanga-based Unity Bank for about P400 million, a company disclosure said.

China Bank informed the Philippine Stock Exchange  that the BSP’s Monetary Board cleared the acquisition on  Nov. 15 and was relayed to the bank on Nov. 20.

The BSP said China Bank will be allowed to acquire 99.95 percent of the outstanding subscribed capital stock of Unity Bank, which has 15 branches.

China Bank should be able to merge within six months the Unity Bank with its subsidiary, China Bank Savings Inc. (CBSI), subject to meeting certain requirements and submission of pertinent documents.

The Monetary Board approval also included the waiver of licensing fees for 18 branches to be opened in restricted areas and another  six branches upon final approval of the CBSI and Unity Bank merger,  for a total of 39 branches.

In line with the purchase, China Bank’s board approved a capital infusion of P360 million to Unity Bank, and to authorize BSP to debit China Bank’s demand deposit account for the capital infusion.

The board also called for the finalization of the stock and purchase agreement for the purchase of 99.95 percent of outstanding subscribed capital stock of Unity Bank, for a total investment of P400 million.

China Bank has appointed Alberto Emilio V. Ramos as the new president of Unity Bank.

China Bank, a member of the SM Group of Companies, currently has nearly 300 branches and is on aggressive expansion towards Southern Philippines. In 2014, it targets to grow its branch network to 400.

CSBI, on the other hand, has 24 branches spread out nationwide, majority of which are located in restricted areas and areas just outside Metro Manila. By 2014, its network is seen to increase more than four times to 100.