MANILA - BDO Unibank said it plans to increase the capital position of its rural banking arm BDO Network Bank (BDONB) by up to P2 billion through the issuance of primary common shares.
The country’s largest bank said this will allow BDONB to support the sustained expansion in its salary loan and MSME portfolios.
BDO said the two lending areas have a compounded annual growth rate (CAGR) of 28 percent over the last 3 years to P37 billion.
“Further, this will enhance BDONB’s ability to cover and serve more markets, particularly the unbanked and the underserved segments of the population,” the Sy-led bank said.
The capital-raising plan will be subject to regulatory approvals.
BDO however also said that while its ruran banking unit has experienced strong growth in recent years, there is no guaranty that BDONB will be able to continue with a similar growth trajectory.
BDONB provides services such as loans, deposits, remittances, bills payments, and others through its network of more than 300 branches and loan offices nationwide, according to BDO.