Ayala-Owned BPI Is Merging With Gokongwei Group's Robinsons Bank
Robinsons Bank, the financial services arm of the Gokongwei Group, is merging with the Ayala-owned and controlled Bank of the Philippine Islands, it was announced on Friday (September 30).
In a disclosure to the PSE, both boards of listed companies JG Summit Holdings Inc of the Gokongwei Group and BPI of the Ayalas said they had approved the agreement, with BPI emerging as the surviving entity.
After the merger is given the green light by regulatory officers, the Gokongwei Group will own about six percent of BPI. Both companies hope to complete the merger before the end of 2023.
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News of the merger between the two financial institutions first spread on Thursday after an unofficial leak all but confirmed the deal. Both companies however said further disclosures will be made at the appropriate time.
According to the release on Friday, the merger “will unlock various synergies across several products and service platforms, expand the customer and deposit base of both banks through the merged entity, and, at the same time, by capitalizing on BPI’s expertise and network, enhance the overall banking experience of RBC customers.”
The merger will still have to be approved by government regulators, including the Philippine Competition Commission, the Bangko Sentral ng Pilipinas, the Philippine Deposit Insurance Corporation, and the Securities and Exchange Commission.
Founded in 1851, BPI is the country’s oldest bank, and the fourth-largest in terms of assets (P2.41 trilion as of end-2021), according to Statista. According to its website, the bank currently has a network of 1,173 BPI, BPI Family Savings (BFSB), and BPI Direct BanKo (BanKo) branches and branch-lite units (BLU) nationwide, as well as over 2,700 ATMs and CAMs (Cash Accept Machines).
Robinsons Bank was founded in 1997 and as of the end of June 2022, its total assets stood at P175.9 billion. It currently has 189 branches and branch-lite units (including 14 branches and 14 branch-lite units of its subsidiary, Legazpi Savings Bank), 354 ATMs, and online and mobile banking channels.
“We are excited about this transaction and believe that this merger exemplifies BPI’s strategic effort to expand its client base, accelerate growth, and ultimately increase shareholder value through partnerships with the Gokongwei Group,” BPI President and CEO, Jose Teodoro “TG” Limcaoco, said. “We plan to effect a smooth transition and integration of RBC and its customers into BPI. Together, we aim to maintain quality banking services and offer additional best-in-class and innovative products to our expanded client base. We are also keen on strengthening our ties with the Gokongwei Group even more through various collaboration opportunities across the Gokongwei Group’s vast ecosystem.”
“Through the years, the Gokongwei Group has built and supported the growth of Robinsons Bank from a small savings bank to become one of the fastest-growing, full-service commercial banks in the country today,” said JG Summit president and CEO Lance Gokongwei. “However, we reviewed our strategic options to determine its future and we are cognizant that banking is a scale game and will continue to require additional capital for growth.
“We believe that merging Robinsons Bank with BPI, which is one of the strongest and most profitable banks in the country, is the best path forward,” he added. “This will give our customers access to a fuller range of banking products and services as the combined organization will leverage on ecosystems of both the Gokongwei and Ayala Groups. The Merger will also open more opportunities for our talented employees given that BPI will continue to grow, evolve and adapt to the rapidly changing market environment.”
The Ayalas and the Gokongweis are two of the richest business families in the Philippines. Ayala Corp has interests in real estate and hotels; financial services and insurance; telecommunications; industrial technologies; power; and automotive, outsourcing, among others, while the Gokongwei Group owns businesses related to banking and financial services, real estate, air travel, retail, petrochemicals, and others.
Esquire Philippines is published by Summit Media which is a company under the Gokongwei Group.