BDO Unibank Inc. is acquiring the entire stake of Nomura Holdings Inc. in their joint venture arrangement under BDO Nomura Securities Inc.
In a statement on Tuesday, the Sy-led bank said that the transaction would enable it to consolidate the securities brokerage business into BDO Securities Corp.
BDO Securities is currently being reorganized into a full-service brokerage firm offering more products to include non-equity portfolios.
Currently, BDO owns 51 percent of BDO Nomura, while the holding company holds the remaining 49 percent. Following the transaction, BDO will have full ownership.
“The transaction is subject to further discussion and final agreements, in addition to any required corporate and regulatory approvals,” BDO said.
The joint venture was approved in January 2016. Operations of the firm began in October the same year.
The Sy-led bank saw its first quarter earnings drop by 10.20 percent to P8.8 billion from P9.8 billion in the same period last year due to trading and foreign exchange losses.
The bank’s total capital base rose to P372.2 billion in the first quarter, booking capital adequacy ratio of P13.8 percent and common equity tier 1 of 12.7 percent.
Amid potential losses due to the pandemic, BDO recently allocated P20 billion in provisions for bad loans, in addition to over P2 billion earmarked in the first quarter.
“The additional provisions are meant to safeguard our balance sheet and will not impair our capital which is strong enough to withstand near-term shocks,” BDO President and CEO Nestor V. Tan said in a recent stockholders’ meeting. “This move is anticipatory in nature. We are not yet experiencing losses.”
Shares in BDO rose by 3.74 percent, or P3.70, to end at P102.70 apiece amid the 0.78-percent dip for the main index on Tuesday.