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M&A Spree, too Big? Not Quite
By philobean | June 24, 2007
China Bank acquires 87.5% of Manila Bank. China Bank is partly owned by Henry Sy’s SM Investments Corporation, the same holding firm that owns majority shares of Henry Sy’s own Banco de Oro and BDO’s new acquisition Equitable PCI. Talk about an M&A craze. While some may now begin to make side comments to the effect of ‘Wow, these banks must now be huge’, this still isn’t entirely true.
Philippine Banks (even the largest ones, traditionally Metrobank and BPI) are small in comparison to the banks of our neighboring countries such as Indonesia (e.g. Metrobank’s 648,787 million pesos or 13,952 million USD pales in comparision to Bank Negara Indonesia’s 169,415,573 million rupiah or 18,782 million USD, approximately only 73% of the size of the Indonesian bank and BNI isn’t even Indonesia’s largest). Comparing our largest bank by assets (Metrobank) with Indonesia’s largest bank by assets (Bank Mandiri), we barely halve the latter’s size at approximately 54%.
Well, surely one can argue that, in terms of fair share vis-a-vis population size, one would only expect Indonesian banks to be bigger than Philippine banks. Let’s take Krung Thai Bank, then, Thailand’s second largest bank by assets. Metrobank is only half the size by assets of the Thai runner-up. Note that the Thai population does not match the Philippine population by a small but statistically significant margin.
See also this (old) circa 2000 Asiaweek ranking of the region’s largest banks.
Topics: Business |
June 24th, 2007 at 8:09 pm
More mergers then?