February 06, 2013

Union Bank to buy City Savings for P5.7 Billion

It has been said that board of Union Bank of the Philippines has already approved the purchase of thrift bank City Savings Bank for P5.7 billion or 2.5x audited book value. Instead of merging its branches The bank decided to keep City Savings bank as separate Subsidiary. The acquisition of City Savings would surely allow Union Bank to be more aggressive in developing their retail base. And for the year 2013, Unon Bank will be adding 10 more branches to the existing 30 branches of City Savings Bank.

Union Bank Manager Raymundo Mendoza said “Please be informed that the board of directors approved as proposed where the bank cannot any more walk-away from the purchase transaction of City Savings from the selling shareholders at the final price of 2.5 times the book value of the shares of City Savings based on the SGV’s final audited financial statements as of Dec. 31, 2012 and the BSP approval of UnionBank’s purchase."

CEO and Chairmain of Union Bank Justo Ortiz said that they are planning to grow City Savings up to the same level as Union bank which has 200 branches across the Philippines.

He said "We are interested in City Savings because this is consistent with our focus and our 2020 goals what we set out to do...to become a retail bank as our historical roots we are in the business of lending to corporate clients."