2011 Annual Report Financial Supplements - BDO

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(vi) The salaries and other compensation given to BDO Unibank Group’s keymanagement are as follows:BDO Unibank Group2011 2010 2009Salaries and wages P 533 P 513 P 504Bonuses 262 255 239Social security costs andother benefits 28 33 34P 823 P 801 P 777Parent Bank2011 2010 2009Salaries and wages P 376 P 349 P 326Bonuses 189 178 165Social security costs andother benefits 20 25 19P 585 P 552 P 51025. TRUST OPERATIONSThe following securities and other properties held by BDO Unibank Group in fiduciary oragency capacity (for a fee) for its customers are not included in the accompanying BDOUnibank Group statements of financial position since these are not properties of BDOUnibank Group (see Note 31.03).BDO Unibank Group Parent Bank2011 2010 2011 2010Investments P 692,480 P 531,025 P 584,740 P 464,093Others 18,931 38,932 17,609 3,552P 711,411 P 569,957 P 602,349 P 467,645In compliance with the requirements of the General Banking Act relative to the Bank's trustfunctions:(a) Investment in government securities (shown as part of Held-to-maturity Investments)with a total face value of P7,043 and P5,887 as of December 31, 2011 and 2010,respectively, in BDO Unibank Group and P5,939 and P4,791 as of December 31, 2011and 2010, respectively, in the Parent Bank are deposited with the BSP as security for theBank's faithful compliance with its fiduciary obligations; and,(b) A certain percentage of the trust income is transferred to surplus reserve. This yearlytransfer is required until the surplus reserve for trust function is equivalent to 20% of theBDO Unibank Group’s authorized capital stock. As of December 31, 2011 and 2010, thereserve for trust functions amounted to P106 and P89, respectively, and is included aspart of Surplus Reserves in BDO Unibank Group equity.www.bdo.com.ph 131
NOTES TOFINANCIAL STATEMENTSDECEMBER 31, 2011, 2010 AND 2009(Amounts in Millions of Philippine Pesos, Except Per Share Data or As Indicated)Income from trust operations, shown as Trust Fees under Other Operating Income,amounted to P1,727, P1,474, and P1,218, for the years ended December 31, 2011, 2010 and2009, respectively, in the BDO Unibank Group statements of income and P1,489, P1,273 andP1,089 for the years ended December 31, 2011, 2010 and 2009, respectively, in the ParentBank statements of income.26. MERGERS AND ACQUISITIONS26.01 Mergers Among SubsidiariesAs discussed in Note 13.01, the Parent Bank approved the five-way merger ofwholly-owned subsidiaries: BDOSHI, ECN, ESHC, BDO Technology, and SPHI, a subsidiaryof ESHC, with BDOSHI as the surviving corporation. The Merger was accounted for usingthe pooling-of-interests method since the merging entities are under the common control ofthe BDO Unibank Group (see Note 13.01.02).26.02 Acquisition of GE Money BankIn May 2009, the Parent Bank and GE Capital, a financial services unit of the General ElectricCompany, announced the signing of a definitive agreement to transfer GEMB in thePhilippines into the Parent Bank. As part of the agreement, GE Capital will also make aninvestment in the Parent Bank by acquiring a stake of approximately 1.5%. The transactionconsolidated GEMB’s business into the Parent Bank, including 30,000 customers, 350employees, a network of 31 branch licenses and 38 ATMs nationwide. On August 24, 2009,the Parent Bank completed the purchase of 98.81% of the issued and outstanding commonstock and 100% of the preferred stock of GEMB for a consideration of P2,000.The agreed price for the net assets of GEMB at the closing date amounted to P1,500. Hence,the Parent Bank recognized goodwill of P500 representing the excess of purchase price overthe fair value of GEMB’s net assets. The goodwill is included in the Other Resources accountin the statement of financial position. The acquisition was approved by the BOD and by theBSP on May 27, 2009 and July 30, 2009, respectively. On August 12, 2010, GEMB amendedits Articles of Incorporation and adopted the name BDO Elite Savings Bank, Inc.
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REPORT OFINDEPENDENT AUDITORSReport
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STATEMENTS OFINCOMEFOR THE YEARS EN
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BALANCE AT JANUARY 1, 2009 P 23,020
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FOR THE YEARS ENDED DECEMBER 31, 20
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1.02 Approval of Financial Statemen
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(ii) Philippine Interpretation IFRI
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PFRS 7 (Amendment), Financial Instr
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(v)PFRS 9, Financial Instruments: C
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BDO Unibank Group accounts for its
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Regular purchases and sales of fina
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Subsequent to initial recognition,
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Certain derivatives may be designat
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NOTES TOFINANCIAL STATEMENTSDECEMBE
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Page 149: COMPANY HEADQUARTERSBDO Unibank, In
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2011 Annual Report Financial Supplements - BDO

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