Profile: BPI's Dennis Montecillo

In April, Dennis Montecillo began his new role as executive vice president and head of the corporate client segment group at the Bank of the Philippine Islands (BPI). The appointment is in many respects the completion of a circular journey. Montecillo, who joined BPI two years ago from placement agent Diamond Dragon Advisors, is returning to his roots after the best part of 20 years in Hong Kong.

"I grew up within a couple of kilometers of where my office is now in Manila," he explains. "I was born here and this was my world for many years, which has helped me reconnect with my networks quite easily."

For Monticello it is a golden opportunity to bring his experience in international investment banking and private equity advisory back to the Philippines at time when people are starting to sit up and take notice of the country. "Because of the relationships I have carried with me, BPI Capital has been the first stop for many GPs and LPs looking to do business here," he says. "There is now a parade of private equity investors coming to do business in the Philippines."

Small beginnings

But it was not always this way. When Montecillo started his career in finance, private equity was all but unheard of in the Philippines, or indeed in Asia. After graduating from Stanford in the 1980s, he joined Bankers Trust - a company since acquired by Deutsche Bank - in New York, covering real estate capital markets, and debt and equity investment in real estate companies in the US, before moving to derivatives.

One of the earliest landmark transactions for Montecillo came during the US savings and loan crisis of the 1990s, a collapse that arguably gave birth to modern private equity. He was part of the deal team that acquired the bank's first portfolio of non-performing mortgages.

"I went from being an investment banker to a loan workout specialist," Montecillo explains. "The federally-backed Resolution Trust Corporation had taken possession of all of the defaulted loans from defunct savings and loans corporations and banks in the US. We bid for, and ultimately acquired, these assets."

His last 18 months at Bankers Trust saw a return to real estate, and to the Philippines, where he was assigned to raise private convertible bonds for the acquisition a real estate project. The 1994 project involved the privatization of a government military base in Manila called Fort Bonifacio, which would later be developed into the Bonifacio Global CIty financial district.

"The check the consortium wrote was upwards of PHP33 billion (then $1.5 billion) for 54 hectares of land," explains Montecillo. "It was a landmark transaction for me because it is what brought me back to Asia, and at that time it was the largest privatization of that type in the world."

At Morgan Stanley I covered two markets - regional private equity and Philippines corporations - but clients in one market were never interested about my role in the other

Following this deal, Monticello moved to Hong Kong in 1996 to work as Philippines country manager for Credit Suisse. Two years later he took up a similar role at Morgan Stanley. However, the combined effects of the Asian financial crisis and the dotcom crash shrunk the bank's fledgling Philippines business and it could no longer justify keeping someone as senior as Montecillo working on the country full-time.

He began looking for other opportunities in the firm and came up with plan to start covering private equity funds in Asia - at the time a novel concept. From 2000 Montecillo continued his country manager role on a part-time basis while he helped build the financial sponsors group covering private equity, venture capital, and hedge fund managers across the region.

This is where he cut his teeth in the asset class for the next seven years, when the chance came to work for one of his clients. Philippines conglomerate Ayala International hired Montecillo as CEO of Fidelis Holdings, its new regional property development business. The company was set up on a side-by-side basis with real estate private equity fund called Arch Capital.

Finding a niche

He stayed in that role until 2010 when - as a result of the global financial crisis - Ayala shuttered its property development business. Montecillo stayed in private equity but this time as his own boss, teaming up with Edward Greene to form Diamond Dragon. The time spent in banking at Morgan Stanley and working with real estate PE funds at Fidelis ensured a smooth transition to advising Asian managers looking to raises capital globally, or global managers seeking to establish a foothold in the region.

However, it was not until he joined BPI that Montecillo felt able to take full advantage of his experience and connections "At Morgan Stanley I covered two markets - regional private equity and Philippines corporations - but clients in one market were never interested about my role in the other," he recalls. "Private equity did not care about the Philippines and Philippine clients were not interested in international private equity."

Now, though, he describes his job as a "dream scenario," in which he helps link his private equity clients with the Philippines as the country's economy, and its private equity industry, is at an important juncture.

"The Philippines is not lacking for potential tractions, nor is it lacking attention from companies wishing to deal with PE," Montecillo notes. "What could be better is the number of transactions actually getting done. I think it is to do with the education process on the part of corporates and private equity to better understand each other's needs."

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