Aboitiz-led Union Bank of the Philippines Inc. is set to acquire additional equity in City Savings Bank Inc. in line with its expansion in the retail banking segment.
In a disclosure to the stock exchange, Union Bank said its board of directors has approved a proposal to purchase the remaining 0.35 percent stake in City Savings Bank held by some 41 minority shareholders for a total of P26.3 million.
The minority stake involves 894 shares priced at P 29,469.93 each.
The additional equity acquisition will be fully executed 12 months or one year from the approval date.
This is the second time Union Bank is raising its holdings in City Savings. In March last year it purchased 62,976 shares priced at P15,879.15 each for a total acquisition cost of P1 billion.
In February 2013, Union Bank acquired City Savings for P5.7 billion.
Union Bank reported a 2014 net income of P8.4 billion, down 6.9 percent from the year before amid an industry-wide decline in trading gains.
The bank aims to grow its net profit by 10 percent to 15 percent to P9.6 billion in 2015, with City Savings expected to contribute some P2.5 billion of the targeted income.
Union Bank is the banking unit of the Aboitiz Group under Aboitiz Equity Ventures Inc. (AEV). Other than banks, AEV is also engaged in power (Aboitiz Power), food manufacturing (Pilmico Foods) and real estate (Aboitiz Land).