Tuesday, 8 May 2012

CIMB acquires 60% stake in Bank of Commerce for RM881m

KUALA LUMPUR (May 8): CIMB Group Holdings has entered into conditional share purchase agreements (SPA) with San Miguel PROPERTIES [], Inc., San Miguel Corporation Retirement Plan and various minority shareholders for the proposed acquisition of 60% of Bank of Commerce (BoC) in the Philippines.

In a statement Tuesday, CIMB said the acquisition was for the equivalent of RM881 million cash.

“BoC is valued at a price to book of 1.14 times as at Dec 31, 2011; but upon full alignment with CIMB Group’s accounting and provisioning policies, the effective price to book is expected to be about 1.30 times,” it said.

CIMB Group chief executive officer Datuk Seri Nazir Razak said that as an ASEAN universal bank, the extension to the Philippines was a very natural one.

“I believe we are entering this market at the right time, with the right deal and right partner,” he said.

CIMB said that BoC was the 16th largest bank in the Philippines in terms of total assets.

“It offers a wide range of banking and other financial products and services including traditional deposit products, corporate banking, consumer banking, treasury, asset management, trust services, trade and credit card services targeting consumer, small-to-medium enterprises and corporate customers,” it said.

BoC currently operates 122 branches and 300 ATMs throughout the Philippines, said CIMB.

Nazir said BoC was small but it could grow quickly with its low loan to deposit base and high capital ratios.

“BoC also strengthens CIMB Group’s overall regional value proposition of facilitating intra-ASEAN investments and trade as well as travel.”

“With this acquisition, our retail network will increase to 1,239 full branches, reaffirming our credential of having ASEAN’s largest branch footprint,” he said.

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