Banking and Finance Industry

[Weina]

Metrobank expects stronger loan growth
03/19/2008 | 08:07 PM

Metropolitan Bank and Trust Co. (Metrobank), the country’s largest bank in terms of assets, expects loan growth to hit 6% this year from 2007’s 5.17%.

"I think the loan growth will be in line with the growth of the economy," treasury group and corporate planning head Fernand A. Tansingco said.

"As we know, the economy is shifting right now because of the problems in the US and also the general shifts in sentiment, but I think we’ll outperform the economy."

The economy expanded by 7.3% last year. Analysts and economists, however, predict slower growth this year due to a global slowdown stemming from the US. Mr. Tansingco said 70% of the loan growth would come from commercial lending, while the remaining 30% would be from consumer lending.

Fabian S. Dee, Metrobank national branch banking sector head, said the company’s loan growth projection was subject to market developments.

"We still don’t know how hard the [US] subprime impact will be on our local economy so it’s hard to go bullish on using the original plans. We have to constantly adjust to market realities," he said. Though the local economy is likely to slow down, Mr. Tansingco said lending opportunities remain.

"There are several bright spots in the economy. Project finance, infrastructure and mining will fuel the loan demand moving forward. But whether the loan demand will kick in this year or next year, we have to wait and see because other sectors are also reassessing their projects now that markets are volatile...," he said.

Vicente Cuna, head for corporate banking of Metrobank, said that the group was particularly interested in the power sector.

"We’re very bullish on the power sector, especially electric co-ops. We feel it’s the sector long neglected by the banking industry because of certain risks that are specific to that sector and I believe it’s all a matter of understanding, how that sector operates...," he said.

Mr. Cuna also said that the bank’s tie-up with International Finance Corp., the private sector investment arm of World Bank, was geared towards biofuels projects.

"Very conservatively, for 2008 we’re looking at maybe a billion pesos worth of projects. [We’re currently looking at] two at the moment - one in the south and one in Luzon," he added. Metrobank, owned by tycoon George Ty, posted a net profit of P7.04 billion last year. — Lovely Nica P. Lee, BusinessWorld

[Weina]

Think tank backs MSME lending

IMPROVEMENTS in financing for micro, small and medium scale enterprises (MSMEs) are necessary for the sector’s growth, the Congressional Planning and Budget Department (CPBD) said.

"Limited access to financing is one of the more serious problems of MSMEs as it affects all aspects of the business," the House of Representatives think tank said in a study.

"The level of investment in research and development, the quality of manufacturing processes, including the kind of machineries and equipment used, and the level of marketing strategies employed are all influenced by the availability of capital to the company," it said.

Specifically, it said a credit information bureau had to be established as banks were reluctant to lend to MSMEs due to the lack of creditworthiness data.

The CPBD also noted that banks perceive the MSME sector as more risky and expensive. "Low capitalization which indicates limited capital flexibility, coupled with lack of proper accounting records, make MSMEs more prone to downturns in the economy compared with large and more established companies," it said.

The quality of collateral required by banks is also not met by most MSMEs, it added.

MSMEs, meanwhile, view bank financing as inaccessible as they encounter difficulties in meeting requirements. Interest rates are also too high for the sector and processing times are also a disincentive.

The House think tank, in encouraging the establishment of the centralized credit information system, said a World Bank study done in 51 countries indicated that such led to a marked increase in lending, particularly to previously excluded sectors. It also noted that the bureau could lead to lower default rates.

Measures creating a Credit Information System — House Bills 118, 1731 and 2443 — continue to languish in the House. A counterpart measure in the Senate has already been approved under Senate Bill 1881.

The CPBD said amendments to the Magna Carta of SMEs should also be made to guarantee that a fair share is loaned to microenterprises. It said the Bangko Sentral ng Pilipinas should strictly monitor bank compliance.

Establishment of an MSME bank will also be helpful in consolidating government financing programs, it said.

MSMEs are said to account for 99% of establishments in the country and employ 69% of the labor force. — AKKA

[Weina]

Philippine banks exposed to high credit losses -- Moody's

Thomson Financial
First Posted 17:29:00 03/25/2008

BANGALORE -- Moody's Investors Service said, in a report on overviews of banking systems worldwide, that banks in the Philippines are exposed to potentially high credit losses due to their operating environment.

Besides the moderately high volatility in the Philippines' business cycles, credit losses have historically been exacerbated by weak governance, Moody's said.

"Bank credit risk in the Philippines has been elevated by a difficult operating environment, a new and developing supervisory and regulatory framework and low level of government support," S&P said.

The ratings agency said these challenges outweigh the benefits derived from the dominant role of banks within the financial system, which have historically faced little competition from domestic capital markets or non-bank financial institutions and developed strong earnings profiles.

The ratings agency said reforms to the Philippine banking system, undertaken since the Asian currency crisis, helped to improve the regulatory and supervisory system, but confidence would be enhanced by greater transparency, formalization of procedures and institutionalization of reforms.

[Weina]

Banks should adopt stronger risk management

LOCAL BANKS may have been spared from loan losses experienced by many US banks as a result of the subprime crisis, but they should continue adopting stronger risk management as a buffer against external shocks.

Compliance with the required minimum capital can only protect a bank from external pressures up to a certain extent, central bank Deputy Governor Nestor A. Espenilla, Jr. said yesterday.

Speaking to risk managers, the central bank official said the global financial turmoil has shown that mere compliance with regulatory capital under Basel 2 may not be enough.

Local banks are more than adequately capitalized as the industry’s average capital adequacy ratio stood at 19.3% as of June last year, way above the central bank’s requirement of 10% and the Bank for International Settlements’ (BIS) 8% standard.

But nurturing a culture of risk management can address the same issues that large US banks are now going through, Mr. Espenilla said.

This includes adopting sound risk management practices for banks’ own inherent value, building a strong capital position, improving personnel capacity, promoting high standards of professional conduct, instilling market discipline and enhancing transparency.

"The origins of the ongoing international financial crisis are broad and complex, but it is now evident that inadequate risk management in financial institutions played a major role," the central bank official said.

He added that lack of risk management had led to impaired public confidence, brought huge losses for many major financial institutions, and tarnished the reputation of their regulators.

"We are not, for a change, figuring prominently as we did in the 1997 Asian financial crisis. Some say we have been quite lucky in that regard, but we made ourselves lucky by doing our homework," Mr. Espenilla said.

He said areas of improvement in risk management among local banks include oversight of board of directors and senior management, as well as increased transparency to the public.

He said banks’ top management often overlook the issue of risk management, which makes it difficult for the central bank to make them understand their recommendations when there is a problem.

Mr. Espenilla further noted that interest in risk management mainly comes from the younger generation of bankers, and not to "those we believe who must understand."

He said the central bank would not be as heavy-handed as to requiring bank tellers to pass the first level of risk management examinations, which is the practice in some Indonesian banks. He said this would entail huge costs to banks. — G.S. dela Peña/Businessworldonline

[Weina]

Central bank frowns at nontransparent sale of gov’t debt

The central bank has rejected a Treasury plan to negotiate the sale of short-term debt instruments, saying it violates market transparency.

"The Bureau of the Treasury will do what is best to meet [its] goals and objectives... At the same time, [it should] consider the best principles of transparency in trading and pricing," central bank Governor Amando M. Tetangco, Jr. told reporters via e-mail.

The Treasury issued a memorandum on March 3 allowing banks to individually make offers for short-term Treasury bills instead of competing with each other at the regular auctions.

The move seeks to keep Treasury bill rates low. The Treasury has been rejecting bids for the three- and six-month T-bills for five consecutive auctions since January, with banks asking for a premium.

The 91-day T-bill, which banks use as a benchmark for their own interest rates, stands at 3.673%.

Market players have rejected the government strategy, which they said is against principles of transparency. They also said it favors large banks given their huge transaction volumes.

"A more transparent system always leads to improved efficiency in price discovery, and ultimately, pricing. It is always, in my experience, better to work within the market framework," Mr. Tetangco said.

The Treasury has scrapped the sale of 91- and 182-day T-bills in the second quarter via regular auctions, and will instead sell the debt instruments via negotiated sale. — Gerard S. dela Peña
http://www.bworldonline.com

[sugarboy]

PNB, Allied Bank to merge
Long-awaited consolidation of Tan-owned banks set for 3rd quarter

PHILIPPINE NATIONAL BANK and Allied Banking Corp., both owned by tycoon Lucio Tan, yesterday announced a long-awaited merger that would create the country’s fourth largest bank in terms of assets.

Officials told a briefing that the merger, valued at P61.9 billion, had been approved by the boards of both banks and would be subject to shareholder and regulatory approvals. It is expected to be concluded in the third quarter, with PNB the surviving entity.

"The merged bank will be the financial services platform of the entire Lucio Tan Group, one of the largest conglomerates in the Philippines," PNB President and CEO Omar Byron T. Mier told reporters.

PNB shares rose by 8.93% to P30.50 while Allied Bank shares were unchanged at P1,000.

The merger will be effected via a share swap. Allied Bank shareholders will receive 140 PNB shares for every Allied Bank common share and 30.73 PNB shares for every Allied Bank preferred share. PNB shares will be issued at P55 per share or at a premium over yesterday’s closing price.

Mr. Tan is the largest shareholder of both lenders. On December 7 last year the Supreme Court lifted a freeze on Allied Bank shares, opening the door to the merger with PNB.

The tycoon had always hoped to merge the two banks but was blocked by a government sequestration of Allied Bank shares imposed after the late dictator and Mr. Tan’s close friend Ferdinand Marcos was deposed in 1986.

The 71-year-old Fujian-born businessman set up Allied Bank in 1977 and acquired majority control of PNB after it was privatized in 1989.

The new bank will have P388 billion in total assets, making it the country’s fourth-largest bank after Metropolitcan Bank & Trust Co., Banco de Oro-EPCI Inc. and Bank of the Philippine Islands.

It would have a combined network of 626 branches and 614 ATMs nationwide.

Stockholders of both banks will take up the merger proposal in June 24.

Reynaldo A. Maclang, Allied Bank president, said the merger would take place at time of continued growth in the banking industry.

"Our merger is therefore a competitive response to the industry’s development," he said.

Allied Bank, in a statement, said "The merger brings together a combined complementary client base ranging from large corporations, local government units, government-owned and controlled corporations, overseas Filipino expatriates, the Chinese-Filipino community to the provincial market."

PNB has an extensive network with the millions of Filipinos working abroad.

Mr. Mier said the merged bank would focus on expanding its presence abroad, particularly in countries where PNB and Allied Bank were not active, citing Malaysia, Indonesia and Greece.

He said the integration process would be completed next year, with positive results expected the year after.

With the Lucio Tan Group and other associates owning 80.7% of the merged entity, Mr. Mier said the bank does not have plans of expanding a public float. Next month, PNB will try to raise P3 billion to P6 billion from issuance of lower Tier 2 unsecured subordinated debt notes.

"Given the capital position of the bank, we don’t see any need to go to the capital market. We have a relatively comfortable capital market base. Right before the merger, Allied Bank went to the market while we are going to the market for P3 billion to P6 billion in lower Tier 2. We don’t foresee any offerings right after the merger," Mr. Mier said.

Eagle Equities Inc. President Joseph Roxas said it was a "good" transaction since there is not much redundancy in the operations of the two banks.

"Consolidation in the industry is slowly happening. Maybe the smaller banks will consolidate next. The Gokongwei group might be interested to buy other banks since they only have one which is Robinsons Savings Bank," he said.

Paul Joseph Garcia, chief investment officer for ING Investment Management Philippines, said "Over the medium-term, we expect the banking sector to consolidate and see more mergers and acquisition activities. There are still too many banks competing in a small banking market like the Philippines." — with reports from AFP and Reuters

[Gento]

Hello All,


I am looking some advice.


I work in banking (in Europe) and am in the process of buying a condo in Metro Manila for investment purposes.


To facilitate the purchase (over a number of years) and to limit currency risk (esp given the potential for significant fluctuation of the Peso), I am looking to open a bank accout, denominated in Pesos, in the Philippines.


One account I will require is a checking account (for monthly payments). In addition, I am also looking for a savings account to earn interest on my Peso-denominated monies.


However, my proposed developer (large &, to best of my knowledge, well respected) is advising that a savings account will only pay interest of 0.50%


Such a rate of interest seems remarkably small, esp as interest rates in the Philippines remain very high by western standards.


Is my developer providing accurate advice or are there more attractive Peso-denominated savings options for non-resident non-Filipinos available?


Thanks,
Gento

[-TC-]

Originally Posted by Gento

Hello All,

I am looking some advice.

I work in banking (in Europe) and am in the process of buying a condo in Metro Manila for investment purposes.

To facilitate the purchase (over a number of years) and to limit currency risk (esp given the potential for significant fluctuation of the Peso), I am looking to open a bank accout, denominated in Pesos, in the Philippines.

One account I will require is a checking account (for monthly payments). In addition, I am also looking for a savings account to earn interest on my Peso-denominated monies.

However, my proposed developer (large &, to best of my knowledge, well respected) is advising that a savings account will only pay interest of 0.50%

Such a rate of interest seems remarkably small, esp as interest rates in the Philippines remain very high by western standards.

Is my developer providing accurate advice or are there more attractive Peso-denominated savings options for non-resident non-Filipinos available?

Thanks,
Gento

Peso SA
Yes, these accounts earn very small interest. Please note that if you were quoted an SA rate of 0.50% gross p.a. then your net interest is only 0.40% p.a. less withholding tax of 20%.

Peso CA
These accounts don't normally earn any interest so for you to earn at least something on your funds, you can open an Automatic Transfer CA with most banks. This CA is linked to an interest-earning SA.

Here are 2 alternative options:

- Some banks give high interest rates on CASA but the ADB requirement is quite high and you are limited to only a few withdrawals in a year. If you are allowed to withdraw at least 12x to coincide with your amortization schedule then this could work!

- You can alternatively ask your bank to invest your funds in a high interest term deposit (e.g. Time Deposit Account, Money Market Unit Investment Trust Fund, etc.) that will mature on specified dates (May 25, Jun 25, Jul 25, and so on) and the proceeds of each maturity on those dates credited to your CA to pay for your amortization. There are other ways but these other TD options will need some monitoring on your end to make sure that your checking account is always properly funded.

[Zodiac18]

Originally Posted by Gento

Hello All,


I am looking some advice.


I work in banking (in Europe) and am in the process of buying a condo in Metro Manila for investment purposes.


To facilitate the purchase (over a number of years) and to limit currency risk (esp given the potential for significant fluctuation of the Peso), I am looking to open a bank accout, denominated in Pesos, in the Philippines.


One account I will require is a checking account (for monthly payments). In addition, I am also looking for a savings account to earn interest on my Peso-denominated monies.


However, my proposed developer (large &, to best of my knowledge, well respected) is advising that a savings account will only pay interest of 0.50%


Such a rate of interest seems remarkably small, esp as interest rates in the Philippines remain very high by western standards.


Is my developer providing accurate advice or are there more attractive Peso-denominated savings options for non-resident non-Filipinos available?


Thanks,
Gento

Try this link!

[Zodiac18]

Originally Posted by Gento
Hello All,


I am looking some advice.


I work in banking (in Europe) and am in the process of buying a condo in Metro Manila for investment purposes.

Hi Gento!

Next week, I'm planning to apply for a checking/savings account in Washington DC
http://www.banking.us.hsbc.com/HICSe...language=en-US

so that I can pay for my future condo purchase (like you) in Baguio.

Credit Card Application Requirements




Thank you for your interest in a credit card from HSBC.
To be eligible for a credit card you must:

Be between 21 and 65 years old and a Philippine resident
Be residing or employed within Metro Manila, Bulacan, Pampanga, Rizal, Laguna, Cavite, Batangas, Cebu, Davao City, Zambales (Subic and Olongapo City), Bacolod, Butuan, Cagayan de Oro, Cotabato, Dipolog, General Santos, Iloilo, Kalibo, Legaspi, Naga, Puerto Princesa, Roxas, Tacloban, Tuguegarao, Tagbilaran City, Zamboanga City, Baguio City, Panabo & Tagum Davao del Norte, Digos Davao del Sur, Laoag City, Ormoc City, Dumaguete City, Cabanatuan City, Dagupan City, Urdaneta Pangasinan, Calasiao Pangasinan, Lucena City, Tarlac City.
Have a residential landline telephone
Have at least a gross annual income of

Php 120,000 for Visa or MasterCard Classic, Mabuhay Miles Visa Classic or RED MasterCard
Php 480,000 for Visa or MasterCard Gold, and
Php 1 Million for Mabuhay Miles Visa Gold

(income must be verifiable and consistent with income proof)

Supplementary cards

Supplementary applicant/s may be any of the following: (1) relatives of the primary applicant defined as spouse, children, children-in-law, parents, parents-in-law, siblings and siblings-in-law; or (2) non-relatives.
If a non-relative, kindly fill out appropriate fields in the supplementary card applicant portion which are required in order that we may process the application. The Bank may obtain additional information from the non-relative in order to process application.
Supplementary applicant/s must be between 15 and 65 years old.
The supplementary card must be of the same card type as the primary cardholder's.
Each primary cardholder is entitled to a total of four (4) supplementary cards.
Primary and supplementary cardholders share the same credit limit.
Billing address will be that of the primary cardholder.
To help you complete our quick application form, please have the following information on hand. You will need approximately 10 minutes to complete the form.

Your Tax Identification Number (TIN)
Your Social Security Service Number (SSS) / Government Service Insurance System Number (GSIS)
Your Credit Card Number/s from other banks
Please ensure that you fill in as many fields as possible to increase the chances of approval. You will be requested by email to submit the following by fax or post:

A valid ID document
A proof of income
The supporting documents we accept are:

1. Valid ID document (front and back copy), any of the following:

Passport
Driver's License
Company ID
SSS/GSIS Photocard
Philippine Regulatory Commission (PRC) ID
BIR ID
2. Proof of Income
In compliance with Bangko Sentral ng Pilipinas (BSP) Circular 472 and 549, you are required to submit your latest Income Tax Return (ITR) form to complete your credit card application.

For employed applicants with a fixed salary, please submit a photocopy of your latest ITR duly stamped as received by the Bureau of Internal Revenue (BIR) or your employer's Certificate of Compensation Payment / Tax Withheld (BIR Form 2316) and any of the ff:

Certificate of Employment (COE) and income
Computerized Latest 1-Month Payslip
Employment Contract
Notice of Salary Increase
Postpaid Mobile Phone Billing Statements. Valid statements must come from either Smart Communications (including subsidiaries Talk 'N Text and Addict Mobile) or Globe Telecom (including subsidiary Touch Mobile) with a minimum plan limit of Php1,300 for Smart subscribers and Php2,500 for Globe subscribers. Statement must be no later than 2 months old when received by HSBC.
For Self-Employed applicants, please submit a photocopy of your business registration with photo and latest audited financial statement as submitted for taxation purposes to the BIR as well as your latest ITR.

Note:
All data submitted will be treated confidentially by HSBC. HSBC will only process applications upon receipt of all required documents and data, and documents supplied will not be returned. HSBC has the right to decline your credit card application, without having to specify and/or disclose the reason.

https://www.tools.asiapacific.hsbc.c...ly?id=ph+ccapp

[-TC-]

http://www.bworld.com.ph/BW051608/content.php?id=021

Back to basics for most banks
BusinessWorld
May 16, 2008

VOLATILE FINANCIAL market conditions, aggravated by the double punch of rising food and fuel costs, are forcing banks to moderate securities trading activity and return to the "basic" business of lending, an industry official yesterday said.

Aurelio Montinola III, president of Bank of the Philippine Islands (BPI), said the bank is recasting its net profit growth projections for 2008, in line with the government’s plan to change its macroeconomic assumptions.

The banking arm of conglomerate Ayala Corp. saw its net profit halved in the first quarter to P1.5 billion from a year ago, as the difficult local market conditions hurt its securities trading gains.

Rising inflation in the Philippines resulted in higher interest rates, forcing the bank to migrate to shorter-tenored peso-denominated debts that in effect churned out lower interest income.

"We did not foresee the combination of the food and oil prices coming in together," Mr. Montinola told reporters in a contract signing between BPI and Manila Water Co. held yesterday.

"Inflation would be higher and therefore, we have to translate that [change in forecast] to [revisions] in other items," he said referring to revisions in the bank’s profit target for the year, which he did not disclose.

Prospects for the second quarter, he said, are not any brighter, with the bank expecting inflation to surge to 8%.

"The first quarter was just a bad quarter. The second quarter should be challenging for most because inflation is going to increase until the third quarter," Mr. Montinola noted.

But while soaring food and fuel costs would likely eat up on a family’s disposable income and dampen consumer spending, the bank is still bullish about growing its loan portfolio by 12-13% this year.

"The general trend is the whole industry is lending or at least is trying to lend. We’re going consumer and SME [small and medium enterprise] lending," Mr. Montinola said.

"We’re back to commercial banking basics," he pointed out.

Growth prospects in mortgage lending remain favorable, as "people still spend for anything that is basic like a house", Mr. Montinola noted, adding that in the first quarter, mortgage loans were up by 30%.

"They are just now more conscious with their money," he said.

Other banks that reported poor first quarter earnings — among them, Banco de Oro Unibank and Philippine Savings Bank — have said they would focus on growing loans and deposits to boost interest earnings and offset the expected poor trading gains.

BPI yesterday closed a deal with fellow Ayala-owned Manila Water, which would simplify the utility firm’s cash management system.

Manila Water previously had partnerships with at least 13 banks that collect payments for its water services- — a process, which it said have made "management and reconciliation processes very tedious, costly and time-consuming."

The BPI-Manila Water deal cuts the cash flow process to just two steps from previous five, Mr. Montinola said. — Maria Eloisa I. Calderon

[kiretoce]

PERA bill to hike savings rate

The country’s savings rate is expected to increase once the bill allowing tax-free personal retirement accounts from taxes becomes law, a lawmaker said.

Senator Edgardo J. Angara said the country’s savings rate would go up to about 30% of gross domestic product (GDP) from 19-23%. He noted that the country’s savings rate is among the lowest in the region, with Malaysia, Singapore and Vietnam at 34-40% of GDP.

"[The Personal Equity and Retirement Account or PERA] is one of the best ways to accumulate savings. It will greatly augment Filipinos’ retirement plan," Mr. Angara told a briefing Friday.

The PERA bill was approved by a bicameral conference last June 10. Mr. Angara, who heads the Senate Committee on Banks, Financial Institutions and Currencies, said the law will likely take effect within the year after the Bangko Sentral ng Pilipinas and the Department of Finance come up with implementing rules.

The bill intends to promote the "culture of savings" among Filipinos, particularly overseas Filipino workers (OFW) who are not required by law to be members of the Social Security System (SSS) and the Government Service Insurance System (GSIS), officials said.

Mr. Angara said the scheme is expected to attract eight million individuals, three million of of them OFWs, with the rest being self-employed individuals or entrepreneurs who are also not required to contribute to the SSS and GSIS.

Under the bill, an individual may make a total maximum annual contribution of P100,000 to his or her PERA account, or P200,000 for married individuals. The contribution can be as high as P400,000 for an OFW and his or her spouse.

Contributions are required to be invested in a qualified "PERA Investment Product," which may be a unit investment trust fund (UITF), mutual fund, annuity contract, insurance or pension products, deposit product, pre-need pension plan, shares of stocks, exchange-traded bonds or any other investment product or outlet.

Contributors are entitled to an income tax credit equivalent to 5% of the total PERA contribution. Income from contributions as well as the eventual distribution of the PERA to the contributor are tax-exempt.

Mr. Angara said the bill has won the support of the business community as mobilization of savings will deepen the local capital market.

[-TC-]

http://services.inquirer.net/mobile/...42631-xml.html

Rise in savings seen with proposed retirement law
Michelle V. Remo
Philippine Daily Inquirer
June 14, 2008

MANILA, Philippines—Filipinos are expected to save more money now that Congress has ratified the Personal Equity and Retirement Account (PERA) bill, said Senator Edgarda Angara, author of the bill.

The Philippines’ savings rate of 23 percent of gross domestic product would easily shoot up 34-40 percent over the medium term with help from the proposed new law, he said.

The PERA bill provides, among others, that income from contributions to the personal retirement account will not be subject to income tax. PERA investors will also be entitled to tax credits equivalent to five percent of their contributions to retirement accounts, said Angara, chairman of the Senate committee on banks, financial institutions and currencies.

Employers that will contribute to their employees’ retirement accounts may deduct the contributions from their taxable incomes, he said.

Personal retirement accounts may be opened in banks, mutual funds and other financial institutions, he added.

PERA contributions should be only put in relatively secure investments that will be identified in the proposed law’s implementing guidelines, Angara said.

The Congress bicameral conference committee passed the PERA bill Tuesday. The bill is up for signing into law by President Gloria Macapagal-Arroyo.

Under the bill, the central bank and the Department of Finance will be tasked to issue the implementing rules and regulations to put the law into effect.

Angara said the PERA bill would primarily benefit overseas Filipino workers (OFWs) and Filipinos who are not members of the pension funds Social Security System (SSS) and Government Service Insurance System (GSIS).

“The bill draws from the experience of overseas Filipino workers who make a huge contribution to our economy in terms of foreign remittances,” he told reporters. “The remittances provide for their families’ present consumption—buying a house, paying for their kids’ tuition, setting up small businesses—but leave very little savings for one’s retirement.”

He added that small-scale businessmen not covered by the SSS or GSIS would also benefit from the PERA bill.

Angara estimated that 22 percent of the country’s labor force of 35.81 million are outside coverage of the SSS or the GSIS.

[Colonel Burger]

Anyone here who has the list of the 10 ten banks in the philippines?

or a list of the top 10 Commercial Banks and top 10 Thrift/savings bank?

[Christendom]

post it later on,,,i have a copies of it,,,local and international chains of banks top lists

[Colonel Burger]

Thanks! i really need it.

[Igsuonnimo]

PNB, Allied vote on merger


Shareholders of Allied Banking Corp. and Philippine National Bank are expected to approve the proposal to merge the two banks in separate stockholders’ meetings today, with PNB as the surviving entity.

The merger will create the country’s fourth-largest bank after Metropolitan Bank and Trust Co., Banco de Oro Universal Bank and Bank of the Philippine Islands.

Taipan Lucio Tan controls both PNB and Allied Bank.

The merger, valued at P61.8 billion, will be done through a share swap completed within the third quarter of the year. It will require approvals from the Bangko Sentral ng Pilipinas, the Securities and Exchange Commission, Philippine Deposit Insurance Corp. and the Bureau of Internal Revenue.

The merged bank will have 15 seats in its board of directors. The PNB board currently has 11 seats.

PNB stockholders are expected to approve an amendment to the bank’s articles of incorporation increasing the number of board seats to 15.

The 15 to be nominated to the PNB board today are taipan Lucio Tan, his sons Lucio Tan Jr. and Michael Tan, his brother Harry Tan, Allied Bank chairman Panfilo Domingo, PNB president Omar Byron Mier, PNB executive vice president Carmen Huang, former Land Bank president Florido Casuela, former PNB president Feliciano Miranda Jr., Domingo Chua, former SGV chairman Gloria Tan Climaco, former Finance Undersecretaries Eric Recto and Florencia Tarriela, Mariano Tanenglian and Washington Sycip.

The merger is expected to result in revenue enhancements and cost savings. The merged bank will have more customers as a result of a larger network and can increase its business from current customers. It will also have a lower overall funding cost from the re-pricing of its deposit products and improved risk profile.

Cost savings will potentially come from branch re-engineering, economies of scale, consolidation of overlapping systems and corporate indirect overheads, realignment of front offices and the optimization of back office processing and support functions.

PNB said in a disclosure yesterday that it issued P6 billion of tier 2 notes last week to beef up capital prior to the merger. The notes were over three times oversubscribed and priced at 8.50 percent, lower than the benchmark five-year government bonds. Allied Bank also issued P4.5 billion in tier 2 notes earlier this year to strengthen the bank’s capital before the merger.

Under the merger proposal, PNB will issue some 457 million new shares at P55 per share for swap with Allied Bank shares. PNB will exchange 140 of its shares for every common share of Allied Bank and 30.73 shares for each of its preferred shares.




From Manila Standard Today

[-TC-]

Approved!

http://www.bworld.com.ph/BW062508/content.php?id=004

PNB-Allied Bank merger okayed by shareholders
BusinessWorld
June 25, 2008

SHAREHOLDERS of Philippine National Bank (PNB) and Allied Banking Corporation — both controlled by tobacco and airline tycoon Lucio Tan — have approved PNB’s $564-million take-over of Allied Bank to create the country’s fourth biggest bank in terms of assets.

PNB will issue 457 million new shares at P55 per share to purchase all of Allied Bank’s common and preferred shares in a deal expected to be completed next quarter.

In a briefing following PNB’s annual stockholders’ meeting yesterday, PNB President and Chief Executive Omar Byron T. Mier said the bank would set aside P1-1.2 billion to cover one-time integration costs within 12 to 18 months after the Monetary Board gives its go signal.

The merged entity is expected to post a net income of roughly P3.5 billion for this year and about P4 billion-P4.2 billion in 2009, which could have been higher if not for the impact of integration cost on the bottom line.

PNB’s net income rose 50% to reach a 10-year-high P1.23 billion last year, while Allied Bank’s net income rose 3% to P1.88 billion.
"There are integration costs as you put the two banks together. The full benefit of the merger will be felt at the end of the second or the third year [after the merger]," Mr. Mier told reporters.

The separate boards of the two banks had approved the plan to merge in their respective meetings last April 30.

After the deal, the Lucio Tan group will have an 81% share in the merged bank.

The merged entity will be the fourth largest lender with total assets amounting to P388 billion. It will have a combined network of 626 branches and 614 ATMs nationwide.

The merger of the two banks has been on the drawing board since last year, but plans were temporarily stalled by a Presidential Commission on Good Government (PCGG) order calling for the sequestration of Mr. Tan’s shares in Allied Bank, as well as in Fortune Tobacco and Foremost Farms and Shareholdings, Inc. Merger moves resumed after the Supreme Court nullified the PCGG order in December 2007.

Asked on whether the bank would offer additional shares, Mr. Mier said PNB did not need additional capital for the moment.

"If we want our shares to churn, somewhere down the line we might have to consider issuing more shares to the public. But we have more than enough capital right now," he said.

The bank may do so after five years, he added, considering that PNB and Allied Bank just recently raised Tier 2 capital, enabling them to secure P6 billion and P5 billion, respectively.

Mr. Mier said the merged bank would have a capital adequacy ratio of about 20%.

He also said that drivers of the merged bank’s growth would be its renewed focus on core businesses such as consumer and corporate loans, as well as remittances. The bank’s total loan portfolio is expected to grow by 15% this year, or at the same pace as last year.

The merger with Allied Bank will also help the bank regain its lead in the remittance business, he said.

"In the last five years, we were focused on bringing down our non-performing assets. But it’s down already. Now we’re focused on our core business," he said.

The bank’s non-performing loans (NPL) were also expected to drop to P7.5 billion from P9.6 billion this year, and further to a range of P5.5-6 billion next year through loan restructuring, compromise settlements and regular collections. The bank will also forge joint ventures with property development firms such as its sister company Eton Properties to make productive use of its idle lands.

Claire Quiray, analyst at Accord Capital Equities Corp., said the news may not have caused any significant movement in PNB’s and Allied Bank’s shares, but the move "will strengthen the bank’s position in the industry in the long run."

Bankers Association of the Philippines Executive Director Leonilo G. Coronel said the merger would further heighten competition in the local banking sector.

"[The merger between PNB and Allied Bank] will definitely make more competition among bigger banks," he said in a telephone interview.
But while such mergers have stoked speculations of further consolidation among more local banks, Mr. Coronel said mergers and acquisitions would still depend on the needs of banks.

And even if the PNB-Allied Bank merger followed the mergers of International Exchange Bank and Union Bank of the Philippines, Manila Banking Corp. and China Banking Corp., as well as of Banco de Oro and Equitable PCI Bank, which all took place last year, the need for mergers will depend on the specific needs of banks, Mr. Coronel said.

"Mergers are driven by need to compete, but it’s a process. It’s not imposed by the government. It’s up to them whether they need the depth and breadth in order to compete. It depends on their market and needs," he explained. — Gerard S. dela Peña and Reuters

[Igsuonnimo]

Hindi ba't magbalae sina Lucio Tan at George S.K. Ty?

Ano kaya ang mangyayari sa China Bank at BDO share holdings ni Henry Sy?

[Igsuonnimo]

4th largest bank formed
By Eileen A. Mencias

Shareholders of Philippine National Bank and Allied Banking Corp. yesterday approved the plan to merge the two banks to create the country’s fourth largest in terms of assets, loans and deposits. PNB is the surviving bank.

PNB and Allied Bank, both controlled by taipan Lucio Tan, expect an integration cost of P1 billion to P1.2 billion in the first 12 months of the merger.

The merged banks, however, are still expected to register a combined profit of P3.5 billion this year, PNB president Omar Byron Mier told reporters in a briefing yesterday. PNB sees profit of P2 billion this year and P2.4 billion in 2009.

PNB posted a net income of P1.5 billion in 2007 while Allied Bank booked a profit of P1.8 billion. The merged banks expect a net income of around P4 billion in 2009.

Mier said the two banks would experience the benefits of the merger after the second or third year when profitability improved significantly.

He said PNB and Allied Bank expect the approval of the Securities and Exchange Commission, the Bangko Sentral ng Pilipinas and the Philippine Stock Exchange on the merger by July and the legal union by August or September.

Mier said the actual integration would take six to nine months and be fully completed by the last quarter of next year.

He said at the PNB stockholders’ meeting that the merger would result in a strong market position, widen local and international network and complement each other’s client base, revenue and cost synergies.

Mier said PNB after the merger would have the largest international footprint among Philippine banks with its combined 124 international offices. The merger will give PNB a distribution network of 626 domestic branches and 614 automated teller machines nationwide.

“We hope to recover PNB’s position as one of the most profitable banks in the country,” Mier told shareholders.

The merger will also raise the bank’s single borrower’s limit to P10 billion, allowing PNB to grant loans to big corporate clients. The bank plans to increase loans this year by 15 percent to P50 billion.

The merger will be done through a stock swap, with PNB issuing 457 million new shares at P55 apiece in exchange for all Allied Bank shares. PNB will account for 59.2 percent of the merged bank’s equity while Allied Bank will share 40.8 percent.

ING, the merger adviser, valued the transaction at P61.8 billion. PNB is worth P36.6 billion while Allied Bank is valued at P25.2 billion.

PNB will swap 140 shares for every common share of Allied Bank and 30.73 shares for each preferred share. Mier said the PNB shares were priced at 1.6 percent to book value while those of Allied Bank were valued at 1.5 percent to book value.



From Manila Standard Today