The World Bank is reportedly seeking an assurance from the Philippine government that taipan Lucio Tan's acquisition of a 48- percent stake in Philippine National Bank (PNB) did not violate any banking laws, that government would conduct a fair and transparent bidding of its remaining shares in PNB and that there would be no bias or cronyism involved in the privatization of PNB.
The World Bank has dispatched a representative to meet with new Finance Secretary Jose T. Pardo and seek assurance on these issues.
Sources said that the World Bank had expressed concern about Tan's acquisition of 48 percent of PNB which was done very quietly and was only revealed when it was already a done deal.
However, Finance Undersecretary Joel Bañares clarified that the World Bank had already been assured by Pardo that Tan's acquisition of his 48-percent stake in PNB was legally acquired through the stock market.
The World Bank reportedly wants an assurance that the remaining 30-percent stake of the National Government would be sold in a fair and open bidding.
The World Bank is concerned, especially since the privatization of PNB is part of the reforms and conditionalities attached to a World Bank $300-million bank sector reform loan (BSRL).
The government has assured that it is pursuing a public bidding of its remaining stake in PNB and would not enter into a negotiated sale with Tan unless there is a failure of bidding.
The objective of the BSRL is to make the banking sector stronger and free it from control by government.
Bangko Sentral ng Pilipinas (BSP) Gov. Rafael B. Buenaventura, for his part, admitted that Tan would still have an edge in acquiring PNB when it is auctioned, but that government would still ensure that the bidding is open and transparent to all interested buyers.
He reiterated, though that the government's 30-percent stake in PNB is not likely to command any premium as compared to the time when government had a majority stake in the bank.