BSP approves Security Bank-BTMU deal

MANILA, Philippines - The Bangko Sentral ng Pilipinas (BSP) has approved the P36.9 billion investment of Japan’s Bank of Tokyo – Mitsubishi UFJ Ltd. (BTMU) for a 20 percent stake in Security Bank Corp.

Melissa Aquino, assistant corporate secretary of Security Bank, informed the Philippine Stock Exchange (PSE) that it has obtained the green light from the BSP to pursue the deal.

“Please be informed that Security Bank has received the approval of the BSP on the 20 percent investment of The Bank of Tokyo-Mitsubishi UFJ Ltd in Security Bank,” Aquino said.

The transaction approved by the BSP involves the issuance of 150.71 million common shares to Japan’s largest financial institution from the unissued authorized shares of Security Bank worth P245 per share for a total consideration of P36.92 billion.

The deal also involves the issuance of all unissued authorized voting preferred shares amounting to 200 million at par value of P0.10 per share for a total consideration of P20 million.

Last Jan. 14, Security Bank and Japan’s largest bank through Mitsubishi UFJ Financial Group (MUFG) signed an agreement involving the acquisition of a 20 percent stake in the listed bank.

BTMU would become the second largest shareholder in Security Bank next to the family of Frederick Dy once the acquisition is completed by the second quarter.

BTMU’s investment would increase the capital base of Security Bank to P89.3 billion from the end-September level of P52.4 billion.

Dy, who is chairman emeritus of Security Bank, earlier said the strategic partnership is significant not only for BTMU and Security Bank but more importantly to the financial system of the Philippines.

“This partnership will enhance Security Bank’s shareholder value by accelerating its growth strategy and business initiatives.

More importantly it is a game changing development that changes the landscape of Philippine banking,” Dy said.

Dy said Japan’s largest bank is an icon not only in the Japanese financial markets but in the Asian and global markets as well.

“I consider the investment of BTMU as a validation of Security Bank’s reputation both here and abroad for the sound fundamentals and excellent corporate governance the bank exudes,” Dy added.

For his part, Security Bank president and chief executive officer Alfonso Salcedo Jr. said the deal would make Security Bank as the country’s 5th largest bank in terms of capital after Metropolitan Bank & Trust Co., BDO Unibank, Bank of the Philippine Islands, and Philippine National Bank.

“With the additional capital, it will help us accelerate our strategy over the next three to five years of building our retail banking business as a third business pillar alongside wholesale banking and financial markets,” he added.