MANILA, Philippines (UPDATED) – Philippine National Bank (PNB) will finally merge with Allied Banking Corp. by February after hurdling the remaining stumbling blocks to the transaction.
In a disclosure to the Philippine Stock Exchange on Friday, January 18, PNB said it received the nods of the Securities and Exchange Commission (SEC) and United Kingdom’s Financial Services Authority on the merger.
The UK regulator okayed the change in control of PNB’s and Allied’s subsidiaries in the European country in relation to the merger of the parent banks.
The SEC, on the other hand, approved the transaction as well as the amendment in PNB’s bylaws reclassifying its preferred shares into common, and increasing the number of its directors to 15 from 11.
“Thus, we now have all the necessary regulatory approvals to implement the legal merger by February 2013,” PNB said.
Both banks are owned by tycoon Lucio Tan. Their stockholders approved their merger in 2008, but a series of requirements and regulatory approvals were in the way.
The merger was approved by the Philippine Deposit Insurance Corp. and the Bangko Sentral ng Pilipinas in 2012.
Before that, the banks secured the go signals of regulators in countries where they set up offices, including Hong Kong and the US.
The merger will be undertaken via a share-for-share swap deal, which will create the country's 4th largest privately owned bank.
PNB, the surviving entity, will have a network of 646 branches nationwide and total assets of P514 billion after the transaction.
PNB also engaged in merger talks with the Ayala group’s Bank of the Philippine Islands in 2012, but no deal was struck. A deal between the two could have created the Philippines' largest financial institution, surpassing Henry Sy's Banco de Oro. – Rappler.com