PCC CLEARS LANDBANK ACQUISITION OF POSTBANK

THE Philippine Competition Competition ( PCC) has approved Land Bank of the Philippines’s planned takeover of Philippine Postal Savings Bank, paving the way for the creation of Overseas Filipino Bank.

“In view of the recommendation competitive constraints on the from the Mergers & Acquisitions parties remain from other market - participants, post-acquisition.” tion obtained from the parties and “The Commission hereby reother sources to date, the acquisition solves that it will take no further … does not result in a substantial action with respect to the transaclessening of competition in the tion. This is without prejudice to relevant markets…,” the anti-trust the Commission’s power to conregulator said in a decision posted duct monitoring of the provision on its website. of wholesale banking services to

It noted that a “loss of compegovernment entities in geographic tition is not likely to result from area where there is a limited the transaction and sufficient number of competing authorized government depository banks aside from the merged entity postacquisition,” it said.

Republic Act 10667 mandates PCC approval for all merger and acquisition deals worth P1 billion and above.

The Bangko Sentral ng Pilipinas green-lit the transaction in December, two months after President Rodrigo Duterte signed Executive Order 44 establishing the OFB.

As a LandBank unit, Postalbank will be renamed Overseas Filipino Bank, serving as a foreign and domestic remittance marketing arm that will cater to the banking needs of Filipino migrant workers worldwide.

The Palace order likewise mandated LandBank to infuse the needed capital and implement a reorganization plan for the bank.

OFB will be managed by a board of directors consisting of nine members including the Landbank president as chairman, the Landbank designated OFB president as vice-chairperson, four Landbank-designated directors or representing the Department of Labor and Employment, Overseas Workers Welfare Administration, the private sector and overseas Filipino workers.

While the total value of the transaction has not been disclosed, preliminary Finance department valuations have put Postalbank’s value at a negative P580 million.

The government has said that it wanted OFB to be operational by February this year.