Banco de Oro-Equitable PCI Bank Merger - Effects of The Merger

Effects of The Merger

If the merger were to take place, Banco de Oro would move up into large capitalized company status, defined as a company whose capital stands at a minimum of $700 million. The merger of both banks would result in the merged company having a market capitalization of two billion dollars. Aside from that, it would also have to consolidate the large Equitable PCI branch and ATM network under the Banco de Oro banner. If the two banks were to merge, the new Banco de Oro would have a total of 685 branches and a wide-reaching ATM network.

Problems with transition could mostly result with the conversion of ATMs: Equitable PCI Fastellers(Equitable EBC Tellers and PCI FasTellers) are both linked to MegaLink(Equitable Banking Corporation) and Bancnet(PCI Bank) while Banco de Oro Smartellers are linked to Expressnet(with ties to MegaLink and Bancnet respectively). Also, Equitable PCI ATM cards are linked to Visa Electron and/or Visa PLUS while Banco de Oro ATM cards are either local or, in the case of the new BDO International ATM Card, linked to MasterCard (branded as MasterCard Electronic), Maestro and Cirrus. Branch transition and consolidation usually run smoothly, as exemplified by the consolidation of the branches of United Overseas Bank under the Banco de Oro banner. BDO has also inherited the 'Jose Velarde' account of former president Joseph Estrada.

A problem arising from this could be that this merger could trigger a wave of mergers and acquisitions that could result in an oligopoly, with only few competitors. The Bangko Sentral is determined to stop this from ever happening in the event that it does.