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Fitch Ratings gives 'stable' rating to BDO

February 1, 2008 4:30pm
International credit rating agency Fitch Ratings on Friday gave a stable outlook on Banco de Oro-EPCI, which will soon be renamed as Banco de Oro Unibank Inc.

"The Outlook on BDOU's ratings is stable given a benign economic environment. And while integration risk is a factor, a successful merger of the two banks will provide ratings momentum, if combined with some capital strengthening in particular," Fitch Ratings said in a note.

Fitch added that BDO will particularly benefit from EPCI's good franchise among commercial entities and consumers, and well developed operations in fee-generating areas such as trust banking, remittances and credit cards.

"Significant revenue and cost synergies should arise from the integration of the two banks, due to complete by mid-2008, as led by BDO's very competent and driven management," Fitch said.

The credit rating agency said that BDO will raise P10 billion of Tier 2 capital, and boosting its capital adequacy ratio by 2 percent to 3 percent.

With the completion of the merger, BDOU will have a network of 680 branches and 1,200 automated teller machines. - GMANews.TV
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