The Bank of the Philippine Islands (BPI) announced recently that it is in talks with the Gokongwei-led Robinsons Bank (RBC) over a possible merger — a move that could potentially make BPI the second-largest bank in the country in terms of assets.
In a statement, the Ayala-led lender confirmed that it was in ‘discussions’ with Robinsons Bank. No further details were provided.
“Please be informed that we are in discussions on a potential collaboration between BPI and RBC. Further disclosures will be made at the appropriate time,” the BPI statement read. As of this writing, both banks have yet to issue a disclosure on their plan to join forces.
Collaboration will enable BPI to overtake Metrobank
However, details of the merger had earlier been reported in Spot.ph, a Gokongwei-owned website, which confirmed that the Robinsons Bank board will approve the marriage today, September 30.
Based on the same media report, RBC will take a six percent stake in BPI after the share swap agreement. BPI, meanwhile, will emerge as the sole surviving entity under the planned consolidation.
With the merger, BPI and RBC will emerge as the second largest bank in terms of assets, with a combined asset base of P2.52 trillion, thereby overtaking Ty-led Metropolitan Bank & Trust Co., which currently has P2.38 trillion worth of assets as of the end of March this year.
According to the Bangko Sentral ng Pilipinas (BSP), BPI is currently the third largest bank in the country in terms of assets, with P2.355 trillion, and second in terms of capital with P297.37 billion as of end-March. It has close to 900 branches and more than 2,500 ATMs.
Meanwhile, RBC ranks as the 17th largest lender in the Philippines with assets amounting to over P164 billion. It has 150 branches plus 354 ATMs nationwide and is now eyeing to launch its own digital bank within this year.
The proposed transaction is still subject to the approval of shareholders as well as regulators, including the BSP, Securities and Exchange Commission (SEC), Philippine Deposit Insurance Corporation (PDIC), and the Philippine Competition Commission (PCC).
Merger is also a good opportunity to augment RBC’s services
In the same article posted earlier in Spot.ph, Elfren Antonio Sarte, president and CEO of RBC, was quoted as saying that the merger offers a good opportunity for RBC to augment its captured niche markets and consolidate them with that in BPI’s ecosystem.
“We will work with BPI to ensure a smooth transition and integration of our clients and operations into BPI. Together, we will maintain quality banking services and offer additional top-notch and innovative products to all RBC customers,” Sarte said in the report.
“For retail customers of Robinsons Bank, the merger with BPI also means access to free cash transfers to GCash instead of sending them with a fee via InstaPay. Withdrawing money will be more accessible as BPI has some 2,500 ATMs, compared to Robinsons Bank’s 354,” he added.
Financial experts believe that the transaction will benefit the Gokongwei Group more as the book value of BPI, which was used as the basis for the swap-share arrangement, is triple that of RBC. They also surmised that BPI could be after the digital banking license of GoTyme Bank, which is one of the six entities recently awarded digital banking licenses by the BSP.
The Gokongweis own a 60 percent stake in GoTyme while a Singapore-based digital banking group owns the remaining 40 percent.