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Green versus blue and white

In the banking community, as it is in the local basketball arena, when one mentions the color green, it usually associated with De la Salle. Blue and white is of course, Ateneo de Manila University.  Most of our bank presidents, chief executives-and operating officers, banking-analysts,markets movers and players received their education from either of the two schools.

But  this piece has nothing to do with the two educational institutions. The colors I refer to here are that of the lenders, their respective marquee, one of which may soon cease to exist, depending on how the gobbling up process will come into play.

I am talking about the plan of the national government to merge United Coconut Planters Bank, which wears the blue-and-white color, and the Land Bank of the Philippines, its marquee predominantly green with specks of gold and white.

Market players and movers are trading inputs and eagerly monitoring if the planned marriage of the two lenders will finally push through in this of COVID-19. Talks about it heightened this week as UCPB is mired in a cyber-heist that is now under investigation by the regulators.

The merger could be a game changer in the banking industry as it could alter the overall standing of banks.

The merger could alter the overall landscape of the domestic banking system, which is currently dominated by BDO Universal Bank, MetroBank, and Bank of the Philippine Islands.

Land Bank is already, on the top 10 list.

Finance Secretary Carlos “Sonny” Dominguez is said to be keen on the union to streamline lending operations.  Although the two lenders have universal banking licenses, Land Bank and UCPB have one common interest-they both cater to the agricultural sector of the economy, one of the largest contributors to the domestic economy.

Relative to this subject is the decision of the Monetary Board, the policy-making body of the Bangko Sentral ng Pilipinas (BSP), to consolidate under one umbrella all lending facilities  to the two sectors.

A proof of the seriousness of SecFin Sonny to push through with the union was the increase in the stake ownership of the government through the Philippine Insurance Deposit Corp. (PDIC) in UCPB from 75 percent to 97 percent in July this year. Dominguez is the chairman of both Land Bank and UCPB.

One more baby step market movers observed  was Dominguez’s appointing Lidovino Geron as the officer-in-charge in UCPB. The presidency of UCPB has been vacant since July of last year following what was described then as the unceremonious departure of Higinio “Joey” Macadaeg, Jr. July 25 last year.

 “These two developments are relevant to the merger,” an informant said.

Heard from the BSP corridor was the request of SecFin Sonny to BSP MB member Antonio Abacan to lend a helping hand in the UCPB-Land Bank marriage. Abacan, former president and chief executive officer of MetroBank, was a veteran player in mergers and acquisition prior to joining the BSP three years ago.

Let’s watch how the Land Bank-UCPB romance ends. This early, the green color is emerging as the male-lead in the wheels of courtship.

Talkback to me at sionil731@gmail.com


Source: Manila Bulletin (https://mb.com.ph/2020/09/03/green-versus-blue-and-white/?utm_source=rss&utm_medium=rss&utm_campaign=green-versus-blue-and-white)

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