BSP orders Unitrust to stop advertisements

The Bangko Sentral ng Pilipinas has ordered Unitrust Development Bank (Unitrust) to discontinue its newspaper advertisements announcing its intention to engage in businesses unrelated to its functions as a thrift bank.

At the same time, the BSP asked Unitrust to a meeting today to discuss certain issues raised by the central bank as well as the Ogami group’s business plans.

The move was prompted by reports that Japanese trader Gento Ogami had acquired 20 percent of Unitrust through his holding company, G. Universal Co. Ltd., while the remaining 80 percent was acquired by other investors belonging to his group.

Following the acquisition, Unitrust went into an aggressive hiring binge, posting several newspaper advertisements that outlined the bank’s new thrust as well as its increased manpower requirement to support its expanded operations.

Deputy governor Alberto V. Reyes said the BSP still has to clear the transfer of ownership to the Ogami group depending on the results of a due diligence review and background check to be conducted by the BSP.

Reyes said the BSP would apply the "fit and proper" test and other prudential rules in evaluating the change in Unitrust’s ownership, including detailed background checks on the new owners, analysis of the fund sources and their financial statements.

In a letter to the Unitrust board of directors and its chairman/president Kensuke Inoue, the BSP’s Department of Thrift Banks and Non-Bank Financial Institutions instructed Unitrust to submit the bank’s audited financial statements as well as the details and terms of the bank’s sale to the Ogami group.

The BSP also required Unitrust to submit documents detailing the background information on its new board of directors, financial statements and corporate profiles of the two companies that led the acquisition – G. Universal Co. Ltd. and Minamoto Saiken Kaishu Co. Ltd.

Formerly owned by the Group Management Corp., Unitrust was acquired by a group composed of G. Universal, Minamoto Saiken Kaishu, Atty. Leopoldo J. Valcarcel Jr., Pedro Montanez and Francis Yuseco Jr.