The Department of Finance (DOF) has announced recently that the final legal merger between LandBank of the Philippines (LANDBANK) and the Development Bank of the Philippines (DBP) could eventually be completed by November this year.
IMAGE CREDIT: bankero.com.ph
In a press statement, Finance Secretary Benjamin Diokno said that they are now just awaiting the issuance of an Executive Order (EO). The issuance is expected to be announced sometime this month following the approval of the GCG or the Governance Commission for Government-Owned or Controlled Corporations.
“There will be a joint crafting and approval of the Operational Integration Plan in September, followed by the approval of the Monetary Board in October, before the final legal merger between LANDBANK and the DBP by November,” said Diokno.
The Finance secretary added that the consolidated bank will soon be in the best position to serve as the only authorized government depository bank for all National Government agencies, Government Owned or Controlled Corporations (GOCCs), government instrumentalities, and local government units (LGUs).
Diokno also stated that the merger can generate up to P975 million in savings for the country per year via the consolidation of branch operations, as well as the expected reduction in personnel expenses.
LANDBANK to keep its name after consolidation
The Finance department has earlier disclosed that the consolidated bank will have an estimated asset size of about P4.18 trillion, and a deposit base amounting to P3.59 trillion.
After the merger, LANDBANK will be the surviving entity given its higher authorized capital stock of P800 billion.
On the issue of employee retrenchments resulting from the merger, Diokno assured the public that they will be working closely with the two banks “to ensure that personnel decisions are consistent with our objective to enhance the bank’s efficiency and effectiveness.”
“It is important that those who will be separated receive a fair package of benefits in recognition of their valuable service to the government,” he added.
Diokno likewise said that there is no more need for a new law to be enacted for the merger to proceed.
According to him, the Supreme Court has already upheld the constitutionality of the GCG Law, which provides for the powers of the GCG to merge GOCCs with charters.