East West acquires Ecology Savings

East West Banking Corp. (Eastwest) is acquiring Ecology Savings Bank Inc. from Equitable PCIBank for an undisclosed amount. The two banks signed a memorandum of agreement (MOA) last Wednesday.

"We will still have to forward the purchase of shares agreement to the Securities and Exchange Commission (SEC), the Philippine Stock Exchange (PSE), and the Bangko Sentral ng Pilipinas (BSP) before we can actually acquire Ecology Bank lock, stock and barrel," bank officials who asked not to be named said.

The original plan of Eastwest was merely to acquire the branch licenses of Ecology Bank. However, Equitable PCIBank preferred to sell the entire thrift bank.

The plan was confirmed in a disclosure to the SEC, which states that Equitable has started negotiations with Eastwest "for the sale of all of the equity interest of Equitable in thrift bank Ecology Savings Bank Inc. Such conveyance, with EBC Strategic Holdings Corp. as seller, and Eastwest Banking Corp. as buyer, shall be documented via a mutually acceptable definitive share purchase agreement."

With the proposed acquisition, the branch network of Eastwest Bank would grow from 47 to 77 with the addition of the 30 branches of Ecology Bank. "It is the only way that banks can expand physically with the existing moratorium of the BSP."

The acquisition process started early this year while a bigger acquisition process involving 1st e-Bank and three to four commercial banks, including Asian United Bank, Bank of Commerce, Banco de Oro Universal Bank, and Chinatrust (Philippines) Commercial Bank.