PNB-Allied Bank merger gets PDIC okay
MANILA, Philippines - State-run Philippine Deposit Insurance Corp (PDIC) has approved the long-awaited merger of Philippine National Bank (PNB) and Allied Banking Corp, which are both controlled by tycoon Lucio Tan.
The merger will be undertaken via a share-for-share swap deal, with PNB as the surviving entity. It will create the country's 4th largest privately owned bank.
"We would like to inform the exchange that we received today an advice from the PDIC granting consent to the proposed merger of PNB and Allied Bank," PNB said in a disclosure to the Philippine Stock Exchange on Thursday, July 26.
PDIC's endorsement is needed before other regulators, Securities and Exchange Commission and Bangko Sentral ng Pilipinas, could process and approve the merger.
It came more than a month after a legal roadblock to the deal was cleared.
The government, through the Presidential Commission on Good Government, tried to block the merger as it sought to recover Lucio Tan's alleged ill-gotten wealth that includes shares in Allied Bank.
In June, however, the Sandiganbayan dismissed the almost 25-year case against the tycoon, who also owned disputed stakes in Fortune Tobacco Corp and Asia Brewery Inc, among others.
The PNB-Alled Bank merger is expected to result in lower operating costs for the combined operations.
The surviving entity will have a network of 646 branches nationwide and total assets of P514 billion, the 4th largest among privately owned banks and the 5th largest among all local banks. - Rappler.com
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