MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) has finally approved the merger between China Bank Savings Incorporated (China Bank) and Planters Development Bank (Plantersbank).
China Bank would be the surviving entity in the merger.
China Bank informed the Philippine Stock Exchange (PSE) that it received the letter on August 14 from BSP's Monetary Board, finally approving its merger with Plantersbank.
As part of the approval, China Bank is required to recapitalize the surviving entity to meet the minimum capital adequacy ratio (CAR) requirement and common equity tier 1 (CET 1) under Basel 3.
Both banks are also required to complete the merger within one year from BSP’s approval.
The central bank is mandating China Bank to secure the consent of state-run Philippine Deposit Insurance Corporation (PDIC) of its merger with Plantersbank. It is also required to submit to BSP the articles of merger approved by the Securities and Exchange Commission (SEC).
Both banks believe the merger is beneficial also to their clients, who will be dealing with a much bigger bank with better and more products and services.
In January 2014, China Bank implemented the share purchase agreement (SPA) to acquire Plantersbank worth P1.86 billion ($39.94 million).
Under the agreement, China Bank spent P1.58 billion ($33.93 million) to purchase the 84.77% capital stock owned by the Tambunting family and related parties, and the Dutch development bank FMO. (READ: Sy group acquires Plantersbank)
The remaining amount would be used to make a tender offer to other shareholders, including Asian Development Bank (ADB), Korea Development Bank, Development Bank of the Philippines (DBP), Land Bank of the Philippines, and International Finance Corporation (IFC) that own 15.23%.
The China Bank Group includes China Bank, China Bank Savings, Unity Bank, CBC Insurance Brokers Incorporated, and Bancassurance affiliate Manulife China Bank Life Assurance Corporation (MCBLife). – Rappler.com
US$1 = P46.57