MANILA, Philippines--Banking giant Metropolitan Bank and Trust Co. will team up with Paris-based Global AXA group, its partner in the bancassurance business, in bidding for the country’s biggest and most profitable insurer Philippine American Life and General Insurance Co.

As widely expected by the market, Metrobank chair Antonio Abacan Jr. announced that Philippine AXA, the existing joint venture with Global AXA, would be the acquisition vehicle in case the team wins the Philamlife bidding.

“If the price is okay, we have to bring in our partner,” Abacan said in a recent interview with the Inquirer. “It will be handled by Philippine AXA.”

He said the partnership would be under a 55-45 percent sharing structure in favor of Metrobank.

Abacan said Metrobank, which had earlier disclosed its interest in Philamlife and its affiliates, could readily produce the cash needed to pay the AIG group if it wins the bidding.

Since the assets of Philamlife would be booked under PhilAXA under such a scenario, Abacan said winning the bidding would not directly boost the total resources of Metrobank.

PhilAXA ranks fourth among the country’s life insurance firms in terms of assets as of end-2007, based on data from the Insurance Commission.

PhilAXA has life insurance assets of P33 billion, next to Insular Life’s P57.2 billion, Sun Life of Canada’s (Phils.) P66.9 billion and Philamlife’s P108.35 billion. It had a market share of about 22 percent in 2007.

The Metrobank Group also owns Philippine Charter Insurance Corp., a nonlife insurance operation.

Philamlife has a consolidated net worth of P49.5 billion and assets of more than P170 billion as of end-2007. Its parent company AIG, which obtained a financial lifeline from the Federal Reserve Bank of New York, is now seeking “top-rated, financially strong brand names” to take over some of its operations outside the United States.

Asked about other potential acquisitions, Abacan said further moves would be a question of additional value, not just size.

“In the past, we acquired so as not to be left behind. But after putting the bank where it should be, if ever we’ll acquire more, we must satisfy ourselves that there will be value added,” Abacan said.

Related websites:
Metrobank
www.metrobank.com.ph