(29 November 2012 – Philippines) The merger of Bank of the Philippine Islands (BPI) and Philippine National Bank (PNB) will make it the country’s largest, with assets of US$29 billion.Moody’s Investor Service said the BPI-PNB merger will create a stronger entity and be credit positive for both banks.
‘BPI’s acquisition of PNB is credit positive for PNB and the Allied Banking Corporation (ABC) because BPI is fundamentally stronger than the other two banks, and as such will be able to improve their credit profiles,’ it said.
Moody’s said talks are ongoing since PNB is in the process of merging with Allied Banking Corporation, which is awaiting regulatory approval of the merger.
“If BPI succeeds in buying the PNB stake and the PNB-ABC merger receives regulatory approval, we expect PNB and ABC to merge with BPI,’ Moody’s said.
Moody’s said PNB and Allied Bank’s current position could diminish BPI’s outstanding performance as the former two rank lowly among rated Philippine banks in key credit performance measures.