China Bank Savings to merge with Pampanga-based bank

MANILA, Philippines - China Bank Savings (CBS) has secured its shareholders’ approval to merge with Pampanga-based rural lender Unity Bank.

CBS, a subsidiary of the SM Group’s China Banking Corp., however said the merger has yet to be approved by the Bangko Sentral ng Pilipinas (BSP) and the Securities and Exchange Commission.

Unity Bank will eventually be folded under CBS, with its branches converted and renamed after CBS core banking system.

The BSP earlier approved China Bank’s acquisition of 99.95 percent of Unity Bank’s outstanding subscribed capital stock in November 2012.

China Bank purchased it for P400 million to expand CBS’ footprint. The acquisition supports the BSP’s Strengthening Program for Rural Banks (SPRB) which aims to effectively serve the countryside and improve the delivery of financial services to rural communities by strengthening the thrift and rural banking industry.

With the approval of the acquisition, the BSP’s policy-making Monetary Board waived licensing fees for 18 more branches to be opened in restricted areas, and another six branches upon final approval of the merger.

CBS president Alberto Emilio V. Ramos said the merger would speed up the savings bank’s branch expansion program.

 â€œFrom this deal alone, we will have at least 73 branches by yearend, on track to meet the target of 100 branches by 2014,” he said.

CBS has already opened nine branches in the first half of the year, bringing the branch count to 42, from 33 last year.

Ramos also reported that the savings bank performed well in 2012 and that it was able to sustain the momentum in the first half of 2013.

CBS’ total resources increased 72 percent to P9.6 billion in 2012. Total loan portfolio expanded 126 percent to P4.3 billion, with all loan product lines contributing to growth.

Total deposits improved 88 percent to P8.3 billion, driven by short term funds.

For the first half of 2013, CBS continued to post hefty growth compared to the same period last year. Loans stood at P6.3 billion, up 124 percent and deposits grew 77 percent to P11 billion.

CBS started operations on Sept. 8, 2008, following China Bank’s acquisition of Manila Bank in late 2007. CBS is focused on the retail market, offering products and services that match different life stages, and its “madaling kausap” brand of personalized service. – With Ted Torres