mergers and acquisitions

BPI-Robinsons Bank merger inches forward as PCC gives clearance

Lance Spencer Yu

This is AI generated summarization, which may have errors. For context, always refer to the full article.

BPI-Robinsons Bank merger inches forward as PCC gives clearance
After securing Philippine Competition Commission clearance, the two banks must now get approval from the Bangko Sentral ng Pilipinas and the Securities and Exchange Commission before finalizing their merger

MANILA, Philippines – The Bank of the Philippine Islands (BPI) announced that its proposed merger with Robinsons Bank Corporation has been approved by the Philippine Competition Commission (PCC).

In a Philippine Stock Exchange disclosure on Friday, September 15, the Ayala-led bank said it had received the signed decision from the PCC last Wednesday, September 13.

The PCC ruled that upon review, the merger “will not likely result in substantial lessening of competition.” Even after the merger, BPI as the surviving entity will merely retain its current rank as the third largest bank in the country in terms of total assets and deposits.

“Although BPI is one of the largest banks in the country, its post-transaction market share is insufficient to substantially lessen market competition. The presence of the remaining market players, including bigger banks, pose sufficient competitive pressure on the surviving entity,” the PCC wrote in its decision.

The merger will allow BPI to engage in digital banking through Robinsons Bank’s 20% ownership interest in GoTyme. However, the PCC also doesn’t expect BPI to have enough market power to foreclose GoTyme transactions with other banks or stop other banks from funding GoTyme accounts. 

GoTyme also still has a relatively small loan portfolio compared to competing digital banks. Currently, UnionDigital Bank has the largest net loan portfolio with P5.74 billion as of December 2022 while Maya Bank has P2.375 billion. By contrast, GoTyme only has P538.8 million.

What’s next?

BPI president and chief executive officer Jose Teodoro “TG” Limcaoco said on August 1 that the merger was on track to be completed by early 2024.

“The Robinsons Bank merger is today with the regulators in terms of seeking approval. We are with SEC (Securities and Exchange Commission) and then the BSP (Bangko Sentral ng Pilipinas), which we follow. We hope to complete this by January 1st. We hope the approvals will come soon,” Limcaoco said during the bank’s anniversary event.

According to a disclosure by JG Summit on Friday, the holdings company of Robinsons Bank, the bank is currently securing the approval of the BSP and the SEC. There is also no exact number of BPI common shares set to be issued to JG Capital yet in relation to the merger.

“The timetable for implementation of the merger cannot be fixed at this time as the same is subject to regulatory approvals,” the disclosure read.

The two banks’ plan of merger states that it will become effective on the first day of the calendar quarter after the SEC issues a certificate of merger that is also approved by the BSP and the PCC. –

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Lance Spencer Yu

Lance Spencer Yu is a multimedia reporter who covers the transportation, tourism, infrastructure, finance, agriculture, and corporate sectors, as well as macroeconomic issues.