DBP slams DOF for railroading merger with Landbank

MANILA, Philippines — There’s no stopping the Development Bank of the Philippines (DBP) from resisting the proposed merger with Land Bank of the Philippines (Landbank), this time slamming the Department of Finance (DOF)’s move to railroad the consolidation.

In a statement, DBP slammed Finance Secretary Benjamin Diokno’s recent statement on the timeline of the legal merger of the two state-run financial institutions.

Late last week, Diokno said the indicative timeline suggests that the legal merger may be concluded in six months’ time or by November.

This, as the executive order is eyed for issuance this month, then the joint crafting and approval of the operational integration plan in September. This will then be followed by the approval of the Monetary Board in October.

“We are deeply concerned about the palpable efforts to railroad the process and to create public confusion by insinuations that the unification would be completed by November,” the DBP said.

“This is notwithstanding DBP’s pending appeal with the Office of the President on the results of the legal study conducted by the Governance Commission for GOCCs,” it said.

The DBP argued that DOF’s timeline is an utter disregard of the clamor from policymakers and stakeholders amid the need to undertake transparent discussion and meticulous analysis of all issues, especially on the impact of DBP employees.

Further, the DBP expressed confidence that President Marcos would listen to such clamor and follow the proper and legally mandated process to protect and advance the banking industry and the country in general.

As such, the bank reiterated its position against the merger, noting that any unification of the two government banks would need Congressional action.

“We will exhaust all available means to ensure that all issues and concerns are properly threshed out and effectively addressed in the proper and legal forum,” DBP said.

The GCG earlier said Marcos could implement the merger, through the issuance of an executive order, without waiting for Congress to file and pass related bills.

“The legal authority of the GCG is at best recommendatory and in no way binding on any government agency,” DBP said.

The proposed consolidation of Landbank and DBP, with the former as the surviving entity, will effectively create a single government bank that will be the largest bank in the Philippines.

Combining the two will result in P4.185 trillion in asset size and P3.588 trillion in deposit size.

It is estimated that the merger can generate up to P975 million in savings per year through the consolidation of branch operations, on top of the expected reductions in personnel expenses.