BDO Unibank Inc., the country’s largest lender in terms of assets, said Monday it is selling a 15-percent stake in rural bank unit One Network Bank Inc. to Singapore-based Osmanthus Investment Holdings Pte. Ltd.
BDO said in a statement it signed an agreement with Osmanthus, in which the Henry Sy-controlled bank would retain 85-percent ownership of ONB.
“This transaction formalizes the working relationship between ONB and Osmanthus, with the latter helping ONB since last year in developing the framework for its MSME lending business, leading to the establishment of the initial pilot test sites before the end of 2017,” BDO said.
It said the partnership with Osmanthus would further strengthen ONB’s strategic foothold in the microfinance business and contribute to the government’s efforts in improving financial inclusion.
Osmanthus is a unit of Singapore-based private equity firm Archipelago Capital Partners Pte. Ltd., a Singapore-based fund that invests in small to mid-market companies in Southeast Asia. Archipelago is managed by former McKinsey and banking professionals, led by chief executive Jovasky Pang, who has an extensive experience in microfinance in Asia.
Pang was previously involved in growing BOC Fullerton Community Bank into the biggest village bank group in China and also headed the SME and commercial business of Bank Danamon Indonesia.
BDO will retain a majority 85-percent ownership, providing continued financial and operational synergies to ONB. BDO’s partnership with Osmanthus in ONB is expected to accelerate ONB’s ongoing thrust into the micro-SME market and further extend coverage of the unbanked and underserved markets.
Pang said he believed in the vast potential of the MSME market in the Philippines, saying Osmanthus was committed to help ONB achieve a leading position in serving these customers.
“We are also excited by the prospect of having a partner like BDO who shares our vision of financial inclusion,” Pang said.
The transaction is subject to closing conditions and regulatory approvals.