CHINA BANK ACQUIRES PUYAT FAMILY'S 87.5% STAKE IN MANILA BANKING CORP
MANILA, JUNE 23, 2007 (STAR) By Ted P. Torres - China Banking Corp. has acquired the Puyat family’s 87.510-percent majority stake in Manila Banking Corp. for a still to be determined amount.
In a statement, China Bank said the final purchase price will be arrived at after its 30-day due diligence to be conducted immediately after the June 21 signing of the memorandum of agreement (MOA).
The resulting merger will boost China Bank’s network of 155 branches by 75 branches from Manila Bank, on top of the ongoing three-year branch expansion program of China Bank.
Of the 75 Manila Bank branch licenses — of which only 27 are operating — 41 are located in Metro Manila while 34 are in provincial areas.
Manila Bank was reopened as a savings bank in June 1999. As of December 2006, its total assets stood at P10.2 billion, loans at P4.4 billion, and deposits at P5.2 billion.
The rapidly changing landscape of the Philippine banking industry has made it tougher for smaller bank to compete.
“It was a difficult decision for the family to let go a business we have painstakingly built over the years. In looking for a partner, we were attracted by China Bank’s industry-best capital strength, financial stability, loyal customers and sustained profitability. We are gratified that Manila Bank will become a crucial part of China Bank’s plans to become a strong major player in the industry,” Manila Bank chairman Luis Puyat said. The Puyat clan founded the bank in 1961.
For his part, China Bank president and chief executive officer Peter S. Dee said that the acquisition of Manila Bank is part of the bank’s three-year business plan, anchored on an aggressive expansion of its distribution network, together with substantial growth in assets and loan portfolio.
The bank is an integral part of the SM Group of Companies of tycoon Henry Sy Sr.
“With a bigger footprint and network through which we can sell and distribute our full range of products and services, we are now in a better position to compete more effectively with the bigger competitors in the banking industry,” Dee added.
China Bank’s 2006 net income performance of P3.54 billion represented a return on stockholders equity of 15.93 percent and a return on assets of 2.47 percent. Its capital adequacy ratio of 28.35 percent adjusted for credit risk continues to be among the highest in the industry, placing it in a unique position of being able to pursue its three-year plan of accelerated loans growth and branch network expansion, absorb the requirements of Basel II, while providing satisfactory returns to shareholders through substantial cash and stock dividends.
Market continues to retreat on lack of fresh leads Saturday, June 23, 2007
Share prices closed 0.36 percent lower yesterday as investors took profits on blue-chips, offsetting gains in the broader market, dealers said.
They said the composite index hit a fresh record high early in the session but investors later changed their minds and sold in the face of a lack of fresh leads.
It finished 13.43 points down at 3,701.16 after hitting a new trading high of 3,730.26. It hit a low of 3,687.00 points.
However, the all-share index edged up 0.72 points to 2,375.71.
Turnover reached 14.3 billion shares worth P19.4 billion.
The large turnover was boosted by block transactions involving shares of low-cost housing developer CP Homes worth P12 billion ahead of the stock’s delisting on Monday.
There were 62 advancers and 56 decliners, while 55 stocks were unchanged.
“The recent record-breaking run has produced handsome gains for a lot of issues in the market and now we’re seeing a correction,” said Lawrence de Leon of Accord Capital Equities.
“However, investors in general are still very optimistic that the market will continue to test new record levels,” he added.
PLDT or Philippine Long Distance Telephone, the nation’s biggest company by market capitalization, was down P20 at P2,690.
Metropolitan Bank and Trust, the country’s biggest lender in terms of assets, fell P1 to P74.
San Miguel A rose P3 to P71.50 while its B shares advanced P1.50 to P77 following a local newspaper report Friday that property-based SM Investments may bid for the government’s 24-percent stake in the food and beverage group.
Ayala Corp., the country’s third-largest company by market value, declined P10, or 1.7 percent, to P570. The stock’s 14-day relative strength index, a ratio based on the changes in its share price in the past two weeks, was at P70.
“The market is in a classic stage of profit-taking,” Rodrigo said. “Investors are taking the money off stocks that have moved sharply, placing some of it on those that lagged.’’
Ayala Land Inc. fell 25 centavos, or 1.4 percent, to P18.25. The stock, which has advanced 44 percent this year, dropped 2.6 percent yesterday after closing at a record on June 20. — AFP
Chief News Editor: Sol Jose Vanzi
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