BPI to gain full control of BPI Globe BanKO

Ayala-led Bank of the Philippine Islands (BPI) is set to consolidate and take full control of BPI Globe BanKO (BanKO), the country’s first mobile phone-based savings bank.

BPI, which currently owns 40 percent of BanKO, will increase its stake to 100 percent by buying the shares of sister company Globe Telecom and parent conglomerate Ayala Corp., which respectively own 40 percent and 20 percent of the bank.

The deal, which is expected to be realized by yearend, will result in BanKO becoming a wholly owned and managed subsidiary of BPI.

In 2010, the Ayala group pioneered a mobile microfinance banking platform in the Philippines with the launch of BanKO, which rides on the financial expertise of BPI and the wireless technology of Globe Telecoms, to promote financial inclusion.

BanKO’s operations were designed in such a way that the cost structure is much lower but nevertheless capable to handle small-sized transactions in high volume and at a reasonable price. As part of its strategy, it uses Globe’s electronic cash or G-cash technology to facilitate the movement of cash in line with its banking operations.

Despite the change in shareholder structure, BPI said BanKO would continue to provide its critical financial services to “underbanked” Filipinos.

The agreement will still be subject to regulatory and business requirements.

“We take this opportunity to thank our partners for giving us yet another opportunity to give access to funds and other banking services to clients who otherwise would not have been able to bridge their personal financial needs and jump-start their ventures,” BPI president Cezar Consing said.

He took note of Globe and Ayala’s contribution in laying the groundwork for addressing the needs of a broader market.

“Over the next few months, we will be in the process of transitioning BanKO within the BPI group and it is our goal to continue providing the highest level of service during this time,” Consing said.

Ayala chair and chief executive Jaime Augusto Zobel de Ayala said, “BPI will now be properly positioned to pursue traditional microfinance lending within existing regulatory frameworks.”

He said the complementary efforts of both BPI and Globe would allow the Ayala group to deliver extensive and innovative microfinance solutions to more clients, specifically the underserved and the underbanked.