BDO Unibank-ONB combination creates new growth opportunities

By Cheneen R. Capon
The combination of the Henry-led BDO Unibank and Davao-based One Network Bank (ONB) will create new growth opportunities not just for the two banks but also for ONB’s clients, who are mostly from Mindanao.
“ONB’s borrowers, depositors and other clients will have the benefits that include bigger financial muscle and more products to invest on,” an earlier report said.
The Bangko Sentral ng Pilipinas (BSP) approved BDO’s acquisition of ONB last month, which covers 105 branches and micro-banking offices in Mindanao and Panay, which are among BDO’s targeted growth areas.
BDO, the country’s largest bank in terms of assets, loans, deposits, capital and trust fund, expressed its interest to purchase ONB during the last quarter of last year which will translate to an instant access to ONB’ 700,000 clients from Mindanao and some parts of Visayas where BDO has no presence.
A reliable source of Edge Davao said ONB’s clients were already informed about the acquisition of ONB for an estimated P10 billion.
“The acquisition of ONB will allow BDO to have access to the big clients of ONB. BDO will become number one both in commercial and rural banking sector,” the source said.
In an earlier report, ONB president and chief executive officer Alex V. Buenaventura said “that the partnership is an ideal combination of the rural bank’s strong regional presence and BDO’s financial muscle.”
“The combination would create new opportunities for growth. This partnership will enable ONB clients to access BDO’s strong balance sheet and expanded banking solutions, while providing BDO inroads to new market segments previously underserved by commercial banks,” Buenaventura said in the report.
Buenaventura further admitted in the report that ONB has had a tradition of cooperation between BDO and the DMCI Group, owners of ONB.
“More than other banks, BDO has partnered with the group in several major long-term large scale investment projects,” he said.
The Consunji-led ONB is Mindanao largest rural bank. Eighty percent of its branch network in Mindanao and has total assets of P28.1 billion, net loans of P19.7 billion, and a deposit franchise amounting to P17.9 billion as of September 30, 2014. 
The source disclosed that initial information revealed that ONB and BDO is planning to retain ONB’s name, while ONB’s employees will be subjected to BDO management.
The source also added that ONB will still continue its expansion plan even though it is under the BDO umbrella.
“Expansion will continue as ONB added three more branches this year. My theory is that BDO will even expand the ONB branch and compete in Luzon,” the source, who is a consultant of ONB, added.
Meanwhile, BSP Governor Amando M. Tetangco Jr. said also in the report that the acquisition could change the face of rural banking in the Philippines.
The acquisition will also improve the state of financial inclusion in the Philippines, according to Tetangco.
ONB is a product of the merger between three rural banks, namely the Consunji-owned Network Rural Bank, Buenaventura-led Rural Bank of Panabo, and Provident Rural Bank of Cotabato in 1996.
BDO is the country’s largest bank in terms of assets, loans, deposits, capital and trust funds. It has one of the largest distribution networks in the country, with 875 operating branches and 2,542 ATMs nationwide.