Union Bank of the Philippines confirmed Friday it is in talks with Citigroup Inc. to acquire the latter’s consumer and retail banking businesses in the Philippines.
“The bank is still in discussions with Citigroup Inc. and no definitive agreement has been signed. Further disclosures will be made when warranted,” Unionbank said in a disclosure to the stock exchange.
The banking unit of the Aboitiz Group made the disclosure to clarify reports tit was acquiring Citibank’s consumer and retail unit in the country.
Citigroup earlier announced plans to exit from 13 markets, including the Philippines, to focus on management and institutional businesses.
Meanwhile, debt watcher Moody’s Investors Service affirmed on Friday the investment-grade or “Baa2” long-term local and foreign currency bank deposit and senior unsecured ratings of Security Bank Corp., reflecting the bank’s strong capital that mitigates its elevated asset risks amid the pandemic.
“The affirmation of Security Bank’s ratings reflects the bank’s strong and above-average capital position that offsets its elevated asset risks; average profitability; modest funding structure, reflecting its moderate deposit franchise as a medium-size bank in Philippines; and adequate liquidity,” Moody’s said in a report.
It said Security Bank’s tangible common equity to adjusted risk-weighted assets ratio would remain above 17 percent in the next 12 to 18 months as its internal capital generation would keep pace with moderate loan growth.
The TCE ratio increased to 20 percent as of end-2020 from 15.3 percent in 2019 due to a contraction in loans and significant decline in the bank’s holdings of investment securities in 2020.
“Security Bank’s nonperforming loan ratio will likely remain elevated at above pre-pandemic levels in the next 12 to 18 months. Lingering stress from the prolonged pandemic disruption in the country has resulted in its NPL ratio increasing significantly to 4.15 percent as of end of September 2021, from 1.17 percent as of the end of 2019,” Moody’s said.
