Via ODiSy March 22, 2012 PHILIPPINE STOCK EXCHANGE ... - BDO

- 93 -13.01.03 AcquisitionsIn 2011, to execute the deed of assignment made on January 13, 2008, the Parent Bankagreed to transfer, cede and convey absolutely to SM Keppel the outstanding advancestotaling P364 recognized as part of Others under Loans and Other Receivables inexchange for 36,401,500 preferred shares of SM Keppel for a subscription price ofP364 (see Note 10). As a result, the investment in SM Keppel as of December 31, 2011increased to P1,658.On February 11, 2010, BSP approved the acquisition by BDO of the 12.4% equityinterest in MNTC equivalent to 2,197,800 common shares held by Global FundHoldings, Inc. (Global Fund) in MNTC for a purchase price of P1,405. The purchaseof 12.4% was previously approved by the BOD on July 25, 2009. Investment in MNTCis recognized as Equity Investments and is presented as part of Other Resources in thestatements of financial position. The Parent Bank is properly represented in the boardof directors of MNTC.In response to the capital infusion call of Generali to cover its 2007 and 2008 capitaldeficiency, BDO Unibank Group’s BOD separately approved on January 9, 2010 andJuly 31, 2010 additional investment of P114 and P156, respectively. The approval ofthe BSP was made on March 5, 2010 and September 21, 2010, respectively. Investmentin Generali has a carrying value of P1,168 and allowance for impairment loss amountingto P898 as of December 31, 2011 and 2010. The investment is recognized as EquityInvestments and is presented as part of Other Resources account.13.01.04 Dissolution of SubsidiariesOn September 30, 2011, the Parent Bank approved the dissolution of PCI ExpressPadala (Hong Kong) Limited effective September 20, 2011. Capital amounting toP248 was fully returned to the Parent Bank on December 5, 2011.On April 30, 2010 by virtue of a proxy letter, the Parent Bank approved the liquidationof PCIB Europe S.P.A with cut-off financial statement date of December 31, 2009.PCIB Europe S.P.A made partial returns of capital amounting to P23 and P1 onJuly 16, 2010 and October 6, 2010, respectively. As of December 31, 2011, total equityof PCIB Europe S.P.A. amounted to P0.5.13.02 Receivables from SPVsReceivables from SPVs represent the amount due from sale of certain non-performingassets to SPVs. In 2005, the former EPCIB (now part of BDO Unibank Group) soldcertain nonperforming assets with book value of P15,069 to Philippine InvestmentOne, Philippine Investment Two and Cameron Granville Asset Management, Inc.(CGAM) for a consideration of P4,134. Cash received from the SPVs amounted toP98 in 2005 and the balance of P3,336, through issuance of SPV Notes, shall be paidbased on a cash flow waterfall arrangement and interest rate of 20% and 50% perannum on the P2,776 and P560, respectively. Also, in 2005, the former EquitableSavings Bank, Inc. (ESB) entered into sale and purchase agreements with CGAM andLNC (SPV-AMC) Corporation (LNC) for the sale of the former ESB’s loans to CGAMfor P621 and for the sale of its investment properties to LNC for P98. The formerESB received SPV Notes amounting to P60 for loans from CGAM and P39 forinvestment properties from LNC, in addition to cash received amounting to P23 fromCGAM and P4 from LNC.