The Philippine Business Bank (PBB) is seeking a private equity partner to help boost its financial technology capabilities and move it closer toward clinching a universal banking license.
Rolando Avante, PBB president and CEO, said in a recent briefing that while they were only around P300 million short of the P20-billion minimum capital required for the license, they still needed to expand their offerings.
This includes establishing an online banking system, Avante said.
“We have met some interested parties … we don’t need only the money because in a year or two, we will be there,” the president said. “Private equities are engaged in a lot of things, so that’s what we’re looking at.”
READ: PBB 9-month profit surges to record P1.8B
A private equity fund’s investment is often seen as a way to increase a company’s value, particularly through capital infusion.
In PBB’s case, Avante explained that they wanted a private equity partner that could help beef up their fintech and information technology capabilities, thus allowing them to offer more services.
The banking business of Zest-O Group founder Alfredo Yao is also set to move its head office from Caloocan City to Makati City in preparation for its application, as this would make PBB more accessible to clients.
“We don’t want to be a unibank by name. Obviously, when you become a unibank … it’s because your capability is there,” Avante said.
“On the service side, we’re quite there, but we’re still putting up other products,” he added.
A universal banking license will widen PBB’s services to include investment banking, insurance and trust services, among others.
Such a license also gives a bank the power to fully own thrift and rural banks.
Data from the Bangko Sentral ng Pilipinas (BSP) show that there are currently 22 licensed universal banks in the country, including most of the publicly listed banks.
Avante likewise noted that PBB still had no set timeline as to when they planned to secure a universal banking license, adding that they were going to meet with the BSP to discuss “where we will be moving the bank.”
In the first nine months of the year, PBB booked record-high earnings as its loan portfolio expanded amid a shift toward consumer banking.
Its net income during the period surged by 57 percent to P1.8 billion, which is equivalent to PBB’s full-year 2023 earnings.
Core income was at P2.4 billion, up by 8.7 percent.
Meanwhile, net interest income jumped by 16 percent to P7.83 billion as the bank favored the high-yielding consumer business and continued supporting small- and medium-sized enterprises.