Keppel Monte Bank is reportedly interested in acquiring Urban Bank even as Banco de Oro continues its negotiation for the closed bank, Bangko Sentral ng Pilipinas (BSP) Gov. Rafael B. Buenaventura said over the weekend.
The International Exchange Bank (iBank), which had earlier expressed interest in Urban, will probably have to pass up this time and solve its problem first, Buenaventura added.
iBank has become an unexpected "fallout victim" of jitters over the swift closure of Urban Bank.
Interest in Urban Bank lies primarily on its 28 branches which are ideally located.
Under the soon-to-be signed revised General Banking Act (GBA), the granting of new branch licenses will be suspended for the next three years. Thus, the only way to expand for existing banks is to acquire other banks.
Interested buyers of Urban Bank, Buenaventura said, will be able to get Urban Bank on a clean book basis minus its non-performing loans (NPLs) and the BSP will allow a rehabilitation program for the closed bank.
He said there will be separate rehabilitation programs for Urban Bank and for its investment house, Urbancorp Investment Corp.
Keppel Monte Bank is controlled by the Singaporean Keppel Group which is primarily well-known for its shipping interest. The Keppel Group had been responsible for saving the distressed Monte de Piedad Savings and Loan Bank.
Monte de Piedad had been the country's oldest savings bank which was almost run to the ground by bad small loans.
Urban Bank had been in the midst of talks with BDO when it suddenly declared a bank holiday, which just as swiftly became a closure by the BSP.
Based on the BSP's examination, its turns out that Urban Bank suffered liquidity problems due to its assistance of its investment house.