THE Philippine Deposit Insurance Corp. (PDIC) has given its conditional approval for the merger of Ayala-led lenders Bank of the Philippine Islands (BPI) and BPI Family Savings Bank (BFSB), with BPI as the surviving entity.
PDIC granted its condition consent through a letter dated July 6, BPI said in a filing on Friday.
The listed lender said the PDIC’s consent will be valid upon the Monetary Board’s approval of the proposed merger. Both BPI and BFSB need to submit to the PDIC a notarized certification of the Monetary Board’s approval within five business days after receipt.
The Monetary Board’s approval will serve as proof that the lenders have notified their clients about the impact of the merger on their deposit liabilities and the rights of depositors. The approval will also mean the Monetary Board’s assessment showed both BPI and BFSB have sufficient liquid funds to cover possible withdrawals from their depositors.
Aside from the PDIC and the Bangko Sentral ng Pilipinas (BSP), BPI also needs to secure the approvals of other regulators for the merger, including the Securities and Exchange Commission (SEC), Philippine Competition Commission, and the Bureau of Internal Revenue.
BPI’s plan to absorb BFSB was announced in January and was approved by a quorum or at least two-thirds of BPI’s stockholders in April.
The listed lender said they expect the SEC to approved its Amended Articles of Incorporation for the merger by October. The merger will be effective upon the SEC’s issuance of the Certificate of Merger or by Jan. 1, 2022.
BPI’s net earnings dropped 21.64% to P5 billion in the first quarter from P6.381 billion a year earlier. This was caused by declining revenues amid lower net interest income.
Its shares ended trading at P88.40 each on Friday, up by P1.40 or 1.61% from its previous finish. — LWTN