Bondholders approve BPI, thrift bank arm merger

MANILA, Philippines — The bondholders of BPI Family Savings Bank (BFSB) have given their consent to the planned merger with parent firm Ayala-led Bank of the Philippine Islands (BPI).

In a disclosure with the Philippine Dealing and Exchange Corp. (PDEx), BFSB said it has ended the consent solicitation period last Aug. 6 instead of Aug.24 under the original schedule.

“The issuer confirms that it has already obtained from the record bondholders the required consent to the merger of the issuer and its parent company, BPI,” the country’s largest thrift bank said.

The bond issuer intends to pay each consenting bondholder, who has submitted a properly and validly executed and validated consent form within the solicitation period, a consent fee of P1 per P1,000 of the principal amount of the bonds.

In its maiden bond offering in December 2019, BFSB raised P9.6 billion via the issuance of bonds with a maturity of 2.5 years.

BPI president and chief executive officer Jose Teodoro “TG” Limcaoco earlier told The STAR the 170-year-old bank is aiming for a Jan. 1, 2022 effectivity date subject to the approval of the Bangko Sentral ng Pilipinas (BSP), as well as the Securities and Exchange Commission (SEC).

The proposed merger aims to unlock the value resulting from enhanced synergy and scale.

Likewise, it will allow the BPI group to harmonize the products and services offering, deliver holistic solutions and elevate the customer experience of both banks.

With the accelerated shift toward digitalization, the consolidation will enable the rationalization of the BPI group’s branch network, streamlining of operations, increased manpower productivity and improved capital efficiency.

Furthermore, the BPI group expects to realize savings on operating expenses given the consolidation of branch locations and marketing support, reduction in tax leakages from intercompany services, and streamlining of compliance and reportorial requirements.

“I don’t think the savings are substantial, there’s a little savings. I think what happens is that we get a lot of significant lift from the removal of confusion of the brand. We are able to also then have the branches all become BPI rather than have some BPI Family and some BPI,” Limcaoco said.

He said BPI would be able to sell all the products across all the branches unlike prior to the consolidation.

The listed bank added both banks would conduct their respective businesses in a substantially the same manner as previously conducted prior to the effective date.

The merger of BPI and BFSB would create considerable value to the customers, employees and shareholders as client of both banks will have access to all the products via all the digital and physical channels.

The merger will also prime the listed bank to seize emerging opportunities and ultimately enhance the overall banking experience of customers.

BPI is the country’s fourth largest universal bank in terms of assets with P1.89 trillion and deposits with P1.44 trillion as of end March this year. It ranked second in terms of loans and receivables with P1.16 trillion and third in terms of stockholder’s equity with P279.58 billion.

On the other hand, BPI Family Savings Bank is the country’s largest thrift bank with P274.65 billion in assets, P222.86 billion in deposits and P222.61 billion in loans as of end- March.