China Bank gets SEC nod on thrift bank merger

MANILA, Philippines – China Banking Corp. has received the green light from the Securities and Exchange Commission (SEC) for the merger of its thrift banking units.

China Bank vice president and corporate secretary Corazon Morando said the SEC has approved the Articles and Plan of Merger between China Bank Savings Inc. (CBSI) and Planters Development Bank (PDB) last Dec. 17.

“As a result of the merger, CBSI and PDB shall become a single corporation, with CBSI as the surviving corporation,” Morando told the Philippine Stock Exchange (PSE).

In relation to the above SEC approval of merger, Morando said the bank’s executive committee approved the regular appointment in China Bank of Carlos Borromeo as senior vice president, chief financial officer and head of Financial Management Segment; Marissa Espino vice president I, chief compliance officer and head of Compliance Office; and Maria Cristina Hernandez as vice president I, head of Treasury Financial Institution, under Financial Capital Markets and Investment Segment starting Jan. 1.

China Bank earlier infused P2 billion in fresh equity to beef up the capitalization of CBSI.

The Bangko Sentral ng Pilipinas has mandated the bank to beef up the capitalization of CBSI as a prerequisite for its impending merger with PDB.

The fresh equity would boost the combined capital of CBSI and PDB to P6.1 billion.

China Bank bought out the 87.51 percent stake of the Puyat family in the The Manila Banking Corp. in 2007. The thrift bank was renamed China Bank Savings in 2008.

Since then, China Bank has been pursuing the complete takeover of CBSI by offering to buy the holdings of minority shareholders.

The Sy-led bank has been gobbling up smaller banks to fast track its expansion nationwide. It acquired Unity Bank in 2012 and PDB in 2014.

In January last year, China Bank implemented the Share Purchase Agreement (SPA) to acquire PDB for P1.86 billion.

Under the agreement, China Bank spent P1.579 billion to purchase the 84.77 percent capital stock owned by the Tambunting family and related parties, and the Dutch development bank FMO.

The remaining amount was used to buy out the 15.23 percent interest owned by other shareholders including Asian Development Bank (ADB), Korea Development Bank, Development bank of the Philippines (DBP), Land Bank of the Philippines, and International Finance Corp. (IFC).

The China Bank Group also includes CBC Insurance Brokers Inc., and Bancassurance affiliate Manulife China Bank Life Assurance Corp. (MCBLife).

China Bank offers a wide range of financial products and services through over 497 branches including those of CBSI and PDB.

Earnings of China Bank grew eight percent to P3.64 billion in the first nine months of the year amid stronger lending and lower cost of funding.