The UnionBank of the Philippines (PSE: UBP) announced on Tuesday that it has acquired First-Agro Industrial Rural Bank (FairBank), a rural bank with 11 branches. The acquisition was done through its subsidiaries, the Union Properties Inc. (UPI) and City Savings Bank, Inc. (CitySavings) after the approval of the Monetary Board.

Here are three fast facts on UnionBank acquiring Fairbank.

 

1. UnionBank said it was a strategic move as the listed financing conglomerate ventures to rural and microfinance banking.

FairBank will serve as the partner of UnionBank in providing rural and microfinance banking to Filipinos in the rural areas. “We are grateful to the founding owners of Fairbank for trusting us to continue their Microfinance mission. CitySavings Chairman of the Board and UnionBank Senior Executive Vice President Eugene S. Acevedo said in a statement.

2. Acevedo added that it is Unionbank’s first step in serving unbanked Filipinos.

Under the Republic Act No. 7353 or the “Rural Act of 1992," the Monetary Board of the Central Bank of the Philippines have the duties to regulate the operation of rural banks in order to provide credit facilities to farmers and merchants. Since the 1950s, rural and thrift banks have been founded by the government in small islands in the country as part of the development of the agriculture industry.

As of 2015, there are already 632 rural banks operating all over the country.

3. FairBank will retain its identity and brand as a rural and microfinance bank even after the acquisition.

Even if UnionBank will own the majority stake at FairBank, the rural bank will still continue with its operations, including its company name and organization.

"With this partnership, we hope to further the reach of our services to the under-served communities around the Visayas and beyond. This partnership shall strengthen our tenacity and open new possibilities,” Dinah FernanVerallo, President, CEO and Chairman of FairBank, said. FairBank has its brand identity as the “dependable partner for a brighter future.”

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