UCPB welcomes gov’t plan to sell its stake

THE UNITED Coconut Planters Bank (UCPB) welcomed the government’s plan to push through with the bank’s privatization, saying this would improve its competitiveness.

“This will definitely redound to the benefit of UCPB and its clients as this will strengthen the Bank’s capital and generate more resources to improve its competitive position in the market,” the bank said in a statement.

Finance Secretary Carlos G. Dominguez III said last week the government would soon start privatizing UCPB. The government is looking to sell its 73.9% stake in UCPB, but has yet to bare concrete plans.

“We will be coordinating closely with the DoF ( Department of Finance) for their next steps, and will provide updates to all our stakeholders as we do so,” UCPB said.

The government’s share is worth at least P1.1 billion, comprised of 1,106,408,800 in common shares at a minimum price of P1 each. The winning bidder is required to infuse at least P15 billion fresh capital.

This would allow the universal bank to meet the central bank’s requirement to meet a 10% capital adequacy ratio, higher than the Basel 3 international standard of 8% by end-December next year.

“We would like to assure our clients that it is business as usual for the Bank while we go through each phase of this much-awaited recapitalization program, and that they can look forward to a better and stronger UCPB,” the local lender said.

Mr. Dominguez earlier said the government will stop its financial support to the bank.

In an Aug. 8 decision, the Supreme Court lifted the June 2015 TRO it issued on Executive Orders 179 and 180 signed by former president Benigno S. C. Aquino III, which provides the administrative guidelines for the privatization of assets acquired using coconut levy funds that were collected from farmers during the government of the late President Ferdinand E. Marcos.

The Court said that the order “does not create a new special fund but merely reiterates that revenues arising out of or in connection with the privatization of coconut levy funds shall be deposited in the Special Accounts in the General Fund.”

UCPB has assets worth P281.5 billion as of the first quarter, making it the 12th largest bank, central bank data show.