President Duterte Green-lights Merger Between State Banks Landbank and UCPB

The merger between the two state-controlled banks Landbank of the Philippines (Landbank) and the United Coconut Planters Bank (UCPB) was recently approved by President Rodrigo Duterte, Malacanang announced on Tuesday.

All of UCPB’s assets and liabilities will be transferred to Landbank, which will be the surviving entity after the President signed Executive Order No. 142 (EO 142) on June 25 aimed at consolidating various benefits for coconut farmers.

In consultation with the Governance Commission for Government-Owned or -Controlled Corporations (GOCCs), the mode of merger and implementation will be determined by both banking institutions subject to the approval of regulatory agencies.

It must also fall within the condition and limitations under the  Revised Corporation Code of the Philippines.

Landbank is also set to acquire UCPB’s outstanding special preferred shares of the Philippine Deposit Insurance Corporation (PDIC) after the merger.

This move will serve to “strengthen government efforts to build a stronger, unified banking institution capable of serving coconut farmers and other workers in the agricultural sector,” said Landbank and UCPB in a joint statement.

Landbank President and CEO Cecilia Borromeo said that the merger will also prove to further promote “unprecedented” rural development pursuant to Duterte’s plan of developing financial inclusion among Filipinos in underserved and unbanked sectors.

“The merger will also mean better financial services for UCPB clients, especially those who are in the farm sector. For the clients of both banks, the merger will mean they can now rely on a stronger and better-capitalized institution with solid government support,” explained Borromeo.

UCPB officer-in-charge Liduvino Geron said that this merger will help them to continue serving coconut farmers. It will also allow them to provide a wider range of products and services to individuals, private institutions, government institutions, middle-market companies, and small enterprise clients nationwide.

Landbank is the country’s largest bank in the public sector and it will remain as the second-largest entity in the Philippine banking industry.

Source: CNN PH