Singapore state fund takes direct stake in BPI

John McDonald June 3, 2017 Comments Off on Singapore state fund takes direct stake in BPI
Singapore state fund takes direct stake in BPI

According to information released just this past week, a major organization in Singapore now has a direct stake in the third largest lending bank in the Philippines, which has sent ripple effects throughout the rest of the financial world of Southeast Asia.

It is still not completely understood as to why the Singapore state fund decided to move forward with this kind of investment and this infusion of cash into a Philippines-based bank, but many believe this is all done in an effort to further improve relationships between these nations and to foster economic development throughout all of Southeast Asia.

Singapore is taking a very active position in the Philippines with this initiative

Three years ago, GIC Private LTD of Singapore first took a small stake in the third largest lending bank of the Philippine Islands. This was seen as pretty routine, as GIC is considered to be one of the world’s largest global investors with more than $100 billion of assets spread throughout 40 different nations worldwide, and the stake wasn’t enough to really draw all that much attention to the transaction at that point in time.

This new transaction, however, has everyone paying close attention and trying to forecast exactly what GIC is going to do in the future. Nearly 46.6 million shares were transferred from the holding company responsible for the bank of the Philippine Islands to GIC, had a value of $4.5 billion on the Philippine Stock Exchange.

The transaction closed at about 5% cheaper than the closing price of BPI shares at that particular point in time, and it now gives GIC a direct 1.2% stake in BPI.

The relationship between Singapore and the Philippines is better now than ever before

Leaders at both GCI and BPI have been very, very open and very transparent about this investment, this transaction, and the relationship between Singapore and the Philippines. President of the holding company responsible for BPI made sure to make note of the fact that the entire transaction was facilitated simply to allow GCI to old more shares directly, and not to in any way unduly influence the financial markets of Southeast Asia.

The relationship that Singaporean the Philippines have been able to foster is very impressive and hopefully this kind of transaction bodes well for transparency moving forward.

It will be interesting to see how this infusion of funding changes the financial community of Southeast Asia

At the same time, it’s definitely going to be interesting to see how everything starts to shake out as far as this infusion of funding is concerned throughout the financial community of Southeast Asia. Singapore is very much the center of financial activity in Southeast Asia, and state funded investors don’t make any decisions lightly or any decisions haphazardly.

This is all obviously a big part of a major initiative moving forward and the overall working financial goals of both Singapore and the Philippines, but it is still as of yet unclear as to how all of the pieces of this puzzle fit together with one another.

About the Author

Morris Edwards is a content writer at companyregistrationinsingapore.com.sg, he writes different topics like New Office Will Prepare Singapore for Increasingly-digital Society and The Most Innovative Economy In Asia and all topics related to Business, Economy and Company Incorporation in Singapore.

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