Exportbank owners nix plan to sell assets

MANILA, Philippines - Stockholders of shuttered Export and Industry Bank have withheld from giving their consent to the government to bid out the lender’s assets, putting the bank’s its rehabilitation in limbo, the Philippine Deposit Insurance Corp. (PDIC) said.

 “PDIC earlier announced that the bidding of the bank’s assets will be completed within the year. It said that the recent development may delay the bidding process,” the state deposit insurer said in a statement.

While shareholders remain “supportive” of the Exportbank’s rehabilitation, PDIC noted that concerns were raised with regard to a court case questioning the bidding process as well as the absence of consent from 100 percent of the bank’s depositors.

Last April 27, the Monetary Board has ordered Exportbank’s closure after it failed to service depositor claims. It was put immediately under the receivership of PDIC, which scheduled a two-tranche bidding process for the bank’s rehabilitation.

The first tranche, which would have involved auctioning off the bank’s assets and liabilities, was declared failed last Oct. 16 after pre-qualified bidders did not submit formal bids. This was after they were informed of a 72-hour temporary restraining order (TRO) preventing PDIC to push through with the bidding.

The Makati Regional Trial Court, which issued the already-lapsed TRO, has since junked the petition of five groups, which ran to the Court of Appeals for relief. The case is still being heard as of press time.

Since the first tranche was unsuccessful, PDIC could not proceed with the second part which would see Exportbank’s commercial banking license offered to investors. It had earlier said this will be delayed until next year.

“Another concern raised by the stockholders is the need for consent from 100 percent of the depositors with uninsured deposits and creditors of (Exportbank) as of the date of the bank’s closure,” PDIC said.

Current data on the number of depositors who gave their consent was unavailable. “We will issue another statement on that next week,” said Auramar Calbario, PDIC corporate communications officer, in a text message.

“Given these recent developments, PDIC is assessing what the remaining viable options are,” the agency said.

Aside from public bidding, tapping a specific and interested “strategic third party investor” to rehabilitate Exportbank is also on the table, PDIC said. This is however without prejudice to efforts exerted to proceed with the auction.

“PDIC assured that it is closely monitoring and pursuing the defense of the legal cases as well as the other conditions of the stockholders in order to meet the requirements for the rehabilitation of EIB to push through,” it explained.