RETAIL BANKING | Tony Chua, Philippines

BPI readies $220mln for possible acquisitions

Lender on a lookout for a potential buy as part of its 5-year growth plan.

The Bank of the Philippine Islands (BPI), the country’s most valuable bank, said on Wednesday a portion of P10 billion ($219.9mln) in core capital it expects to raise from the ongoing stock-rights offer could be used for possible acquisitions within the next five years.

While there are no specific acquisition targets at the moment, the bank wants itself “to be ready when an interesting development comes up,” BPI president and chief executive officer Aurelio Montinola III said in a news briefing.

The bank, currently the third-biggest local bank in terms of assets, has come up with a five-year growth plan under which lending is projected to grow by 10-15 percent every year.

BPI expects its capital adequacy ratio (CAR) to rise to 16.4 percent after the share sale. With an estimated CAR of 13.8 percent as of end-June, well above the minimum regulatory requirement of 10 percent, the bank is deemed to have enough capital buffer against potential losses from market and credit risks.

The additional core capital from the share sale is deemed adequate to match any additional risks within the next five years.

View the full story in Business Mirror.

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