CREDIT card issuer Equitable Card Network Inc, a unit of Equitable PCI Bank (EPCIB), will soon be folded into Banco de Oro Universal Bank (BDO), EPCIB said in a disclosure to the stock exchange Wednesday.      

BDO has bought EPCIB, and the former shall be the surviving entity once a merger of the banks is completed next year.

“The board of [EPCIB] resolved to fold its subsidiary, Equitable Card into EPCIB or into the surviving entity resulting from the merger between EPCIB and BDO, for reasons of efficiency and economy building, but not limited to, saving on intermediation costs,” EPCIB said.      

Equitable Card is both an issuer and acquirer of VISA, VISA Electron, MasterCard & JCB, and the only issuer of American Express credit cards in the Philippines. As a result, Equitable cards and its network of tie-up banks and financial institutions nationwide account for the largest  share of the local market in terms of cardholder base and gross sales volume.               

It was incorporated in May 1989 as a fully-owned subsidiary of Equitable Banking Corp.  

Analysts already anticipated the move of EPCIB. “It’s an expected development,” said Alvin Arogo, an analyst for Unicapital Securities, Inc., in an interview with the BusinessMirror. “One thing that would come out from this is efficiency and that’s what BDO, as the surviving entity, is trying to achieve. By folding it, the merged entity will have lower operating cost, thus, allowing them to achieve better bottomline.”              

On December 27, the respective shareholders of BDO and EPCIB approved the merger of the two entities in separate meeting, paving the way for the creation of Banco de Oro-Equitable PCI Bank Inc. 

The integration of the banks’ networks is up for completion in 2008.   

The merged entity will create the second-largest bank in terms of total assets, the third biggest in net loans, the second in deposits and third in branch network.

At present, Metrobank is considered as the country’s largest bank, followed closely by the Bank of Philippine Islands.   

The respective board of directors of BDO and EPCIB approved the merger plan of the two entities on November 6, effecting the largest merger in Philippine banking history. Completion of the transactions is subject to regulatory approval and is expected to close by the first quarter of 2007.          

The combination will be structured as a merger and executed by means of a share-for-share exchange. Under the terms, BDO will serve as the surviving entity and EPCI shareholders will receive 1.80 BDO shares for every EPCI share.

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CREDIT card issuer Equitable Card Network Inc, a unit of Equitable PCI Bank (EPCIB), will soon be folded into Banco de Oro Universal Bank (BDO), EPCIB said in a disclosure to the stock exchange Wednesday.