Bank for OFWs could open in February 2018

MANILA, Philippines – The Bangko Sentral ng Pilipinas (BSP) announced on Friday, December 22, that it gave state-run Land Bank of the Philippines (Landbank) the green light to acquire the Philippine Postal Savings Bank (Postbank). The acquisition will pave the way for the opening of the Overseas Filipino (OF) Bank expected as early as February 2018.

According to BSP Deputy Governor Chuchi Fonacier, the central bank’s Monetary Board approved the acquisition in early December.

“It has already been approved actually. It was approved two weeks ago,” she added.

Fonacier also said the application to set up the OF Bank has already been filed and is now being evaluated by the central bank, prior to approval of the Monetary Board.

“I think they are targeting to start operations by February,” BSP Governor Nestor Espenilla Jr said.

PCC approval

Fonacier added that the transaction would still have to be approved by the Philippine Competition Commission (PCC). (READ: What you need to know about the Philippine Competition Act)

According to PCC Chairman Arsenio Balisacan, documents involving Landbank’s acquisition of Postbank have been submitted and are now being reviewed.

“Now we have the process in place, we’re expecting this next year. The documents have just been submitted so we can review. Hopefully the process can move quickly,” he told reporters.

Under the first phase, the PCC has a period of 30 days to act on the application. 

The PCC is mandated to review transactions involving mergers and acquisitions worth at least P1 billion. A decision should be issued within 90 days.

“Our rules require us to make a decision in a maximum of 90 days,” Balisacan said.

Last September 28, President Rodrigo Duterte issued Executive Order No. 44, authorizing Landbank’s acquisition of Postbank to pave the way for the establishment of a financial institution dedicated to Filipino workers abroad.

Landbank president Alex Buenaventura earlier said they were eyeing the launch of a pilot OF Bank branch in Dubai on January 2, 2018. Another branch in Bahrain is expected to open in April 2018.

A total of around 25 branches will be opened in the United States, Japan, Middle East, and Hong Kong, among others.

The OF Bank was first announced by Finance Secretary Carlos Dominguez III in December 2016. He said it would be partly owned by OFWs. – Rappler.com