Landbank, UCPB merger takes effect on March 1

MANILA, Philippines — The merger between Land Bank of the Philippines and United Coconut Planters Bank (UCPB) will take effect on March 1, with both banks saying their operations will remain online as they integrate their services and systems.

In a notice to the public, creditors and depositors of Landbank and UCPB were advised that the financial institutions would pursue the merger, with Landbank as the surviving entity.

Landbank and UCPB said their respective board of directors, including stockholders, approved the terms and conditions laid out in the plan of merger and articles of merger. They also secured the required authorizations for the buyout to take place.

As a procedure, the merger was endorsed by the Governance Commission for GOCCs and was approved by the Monetary Board of the Bangko Sentral ng Pilipinas and state-run Philippine Deposit Insurance Corp.

The Securities and Exchange Commission, on the other hand, issued the certificate of approval for the plan of merger and articles of merger permitting the banks to push through with the transaction.

Landbank said banking services would go on as usual during the consummation of the merger.

UCPB branches will also remain operational to serve its former clients until the bank’s systems are transferred and its customers are migrated to Landbank.

As a result of the merger, assets held by Landbank will increase to nearly P3 trillion, cementing its position as the second largest bank in terms of assets. On the other hand, farmers invested in UCPB stand to gain from the state-owned bank’s lending portfolio for the agriculture sector.

Agriculture lending by Landbank grew by an average of 2.28 percent in a span of three years to P237.62 billion in 2020, from P222.05 billion in 2018. Agriculture loans accounted for roughly 77 percent of the bank’s lending portfolio in 2020, exceeding the 15 percent level mandated by the Agri-Agra Reform Credit Act of 2009.

Upon the completion of the merger, clients of Land bank and UCPB will gain access to a total of 667 branches and 2,722 ATMs nationwide.

Last year President Duterte issued Executive Order 142 approving the acquisition in an effort to improve the delivery of financial services to the coconut industry and the agriculture sector.