DBS Sells Philippine Subsidiary To
Bank Of The Philippine Islands

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Move Consolidates DBS Bank's Philippine Presence in BPI

SINGAPORE, AUG 15 - The Development Bank of Singapore Ltd (DBS) and Bank of the Philippine Islands (BPI) announced today that they have reached agreement for BPI to acquire 100% of the shares of DBS Bank Philippines, Inc. (DBSP).

The transaction consolidates the banking presence of DBS in the Philippines into its larger investment in BPI. DBS owns 21% of BPI.

Under the terms of an agreement signed today, BPI will acquire DBSP in a cash deal, for a total consideration of P1.6 billion (S$55 million). The sale and purchase is subject to regulatory approvals.

BPI is currently the second largest bank in the Philippines in terms of assets. Total assets were P393 billion (S$13.6 billion) at the end of 2000, with capital funds of P49 billion (S$1.7 billion). It has a total market capitalisation of P110 billion (S$3.8 billion), making the bank one of the largest Philippine corporations listed on the Philippine Stock Exchange. Established in 1851, BPI celebrates its 150th anniversary this year.

DBSP is a commercial bank with 20 branches and total assets of P16 billion (S$552 million). It currently ranks 27th by total assets and 28th by capital funds among the 45 commercial banks in the country. DBSP was formerly known as Bank of South East Asia, which DBS acquired in August 1998.

DBS officials said the move was an obvious one, and one which the market had anticipated for some time.

"Our sense is that our time and attention in the Philippines is best invested in a larger, more established banking franchise such as BPI. DBSP, with a rather small presence in the Philippine market, would require substantial investment to fuel organic growth. This transaction is one that benefits both parties, and DBSP customers as well, since it will make available to them a substantial new range of BPI services and products," bank officials said.

BPI is a leading provider of a wide range of financial services in the Philippines. Apart from its traditional banking franchise, BPI has significant presence in the credit cards industry, investment banking, securities trading, and more recently the insurance business through its transformation into a bancassurance organisation last year.

DBS Bank is the flagship bank of DBS Group Holdings in Singapore. It is ranked among the top banks in Asia. A recognised leader in Internet banking and e-commerce, DBS is the market leader in Singapore-dollar loans and deposits, and equity fund raising. Beyond Singapore, DBS Group serves corporate, institutional and retail customers through subsidiaries in Hong Kong, Indonesia and Thailand, and provides international banking services through a network of 13 overseas branches and offices. Recent developments for DBS Group Holdings Ltd include the acquisition of Dao Heng Bank Group in Hong Kong. With the acquisition, DBS is now the fourth largest bank in Hong Kong by assets.