Security Bank Corp. on Friday received P36.5 billion from Bank of Tokyo-Mitsubishi UFJ Ltd. as payment for the acquisition of 20 percent of the local bank to complete the strategic partnership agreement they signed on Jan. 14 this year.
The capital investment was so far the largest by a foreign financial institution in the Philippines. Security Bank, in turn, issued to BTMU 150,707,778 common shares and 200,000,000 preferred shares, representing BTMU’s 20-percent ownership of the voting stock in Security Bank. The deal obtained the approval of Bangko Sentral ng Pilipinas on Feb. 24.
BTMU is now the second largest shareholder of Security Bank, while Security Bank is now an equity affiliate of BTMU. The Dy Group remains the biggest shareholder of Security Bank with majority voting control.
As a result of BTMU’s investment, Security Bank’s shareholder capital increased to P90.2 billion pro-forma as of April 1, 2016 from P53.2 billion as of Dec. 31, 2015.
Security Bank’s book value per share increased 36 percent to P119.53 pro-forma as of April 1, 2016 from P88.17 as of Dec. 31, 2015, putting it among the five largest private domestic universal banks in the country in terms of capital. The additional capital will be used to accelerate the execution of Security Bank’s growth strategies.
“We will be able to more effectively deliver our service-oriented BetterBanking brand to our customers through a larger branch network and a more comprehensive range of financial services. We hope to accelerate growth of our retail banking business as well as better coverage of the SME sector,” Security Bank president Alfonso Salcedo Jr. said in a statement.
“With BTMU’s expertise in project finance, we expect to participate more actively in PPP [public-private partnership] and infrastructure projects. Additionally, in partnership with BTMU, Security Bank will be able to penetrate the Japanese business community,” Salcedo said.
Security Bank chairman Alberto Villarosa said with bigger capital and the combined strengths of Security Bank and BTMU, “we look forward to serving our customers better than before.”
Go Watanabe, chief executive BTMU Asia and Oceania, said the strategic alliance with Security Bank was aligned with the bank’s expansion plan in Asia.
“We are very excited with the opportunity to work closely with Security Bank. We have started exploring various areas for collaboration including work-site business and PPP projects. By partnering with Security Bank, we can expect to expand our business platform and identify new business areas for BTMU in the Philippines,” Watanabe said.
Watanabe earlier said the Philippines would play a vital role in BTMU’s goal of becoming the top-tiered bank in Southeast Asia by 2020. He said the Philippines was an important market for BTMU.
He cited potentials in the Philippine market, with its robust economic growth that has been one of the fastest in the region for the past few years, and its more than a hundred million population.