PNB secures BSP OK for thrift arm merger

The consumer lending business, currently operated through PNB Savings, will also benefit from PNB’s ability to efficiently raise low cost of funds

Lucio Tan-led Philippine National Bank (PNB) on Friday said it has secured Bangko Sentral ng Pilipinas (BSP) approval for the merger of its wholly-owned thrift banking arm, PNB Savings Bank.

The listed lender said the monetary board, in Resolution 1310 dated 29 August 2019, approved the merger of PNB Savings Bank with its parent firm as stated in a letter dated 3 August that PNB received on 5 September.

Aside from the central bank’s green-light, PNB also needs the approval of the Securities and Exchange Commission, the Bureau of Internal Revenue and the Philippine Competition Commission to close the transaction.

PNB first announced the absorption on 28 September last year. The bank earlier on said the integration will strengthen its stance in the consumer and small and medium enterprises business segments.

“Once integration is rolled out, PNB would be able to deliver a more efficient banking experience, and will be able to serve a wider customer base while the customers of PNB Savings Bank will have access to PNB’s diverse portfolio of financial solutions upon full integration,” PNB disclosed to the stock exchange.

“The consumer lending business, currently operated through PNB Savings, will also benefit from PNB’s ability to efficiently raise low cost of funds,” it added.

Under the transaction, PNB will be acquiring its unit’s assets and liabilities in exchange for cash, subject to said regulatory approvals.

The consolidation will also sync the lenders’ branch networks. It will bring PNB’s total domestic footprint to 707 branches and more than 1,240 automated teller machines nationwide.

PNB booked a 27.7 percent drop in net income in the first six months of the year, to P3.9 billion from P5.4 billion in the same period in 2018 on the lack of non-recurring income from a one-time gain from the sale of foreclosed assets last year.

It posted a 13 percent growth in loans and receivables, to P594.1 billion, due to growth in loans to commercial and SME segments.

Shares of PNB were sold for P46.05 apiece as of 11:14 am on 6 September, up 0.11 percent.