AUB infuses P400M in Rural Bank of Angeles

MANILA, Philippines - Asia United Bank (AUB), a commercial lender majority controlled by the Rebisco Group, will infuse P400 million to its newly-acquired Rural Bank of Angeles (RBA), the banking arm of the Cooperative Bank of Pampanga (CBP).

The fresh capital infusion is part of the proposed sales transaction which will also involve the purchase by RBA of all the assets, including the seven existing banking units (i.e. six branches and the head office), and assumption of all liabilities of CBP.

“Given that the liabilities of CBP are in excess of the recoverable value of its assets, no cash consideration will be paid to CBP or to any shareholder of CBP as part of the transaction. Following the transfer of all assets and liabilities of CBP to RBA, the CBP will be surrendering its banking license to the BSP and cease to operate as a cooperative bank,” AUB said.

After the capital infusion, AUB will receive certain incentives and relief from the central bank, including the award of 20 branch licenses in restricted areas.

AUB will likewise undertake activities to maintain RBA’s net worth to be at least P100 million, and maintain RBA’s capital adequacy ratio at a minimum rate of 15 percent post-transaction.

CBP offers peso savings accounts, peso time deposit accounts and peso demand deposits. lt also offers loan and credit facilities and money transfer services. At present, it operates out of seven locations, all in Pampanga: Angeles, Mabalacat, San Fernando, Sta. Ana, Apalit, Lubao and Floridablanca.

As of August 2Ol3, CBP had total assets of P152.6 million, total liabilities of P342.7 million, and net capital deficit of P190.1 million. As of the same date, it also employed 65 employees.

For RBA, AUB said this acquisition is expected to further facilitate the expansion of RBA’s microfinance / countryside lending activity in Pampanga.

RBA now has total assets of P416.1 million and a net income of P10.9 million as of end-2012.

The acquisitions of CBP and RBA, in addition to Asiatrust Development Bank and Cavite United Rural Bank, are expected to expand AUB’s reach, which now counts 137 branches nationwide.

Coming on the heels of a successful public listing last May and its recent upgrade into universal banking status, AUB has been aggressively expanding its nationwide branch network and targets to grow its network to 200 branches by 2014.