BSP slaps P1-M fine to BPI over Family bank merger

MANILA, Philippines — The Bangko Sentral ng Pilipinas slapped a P1 million fine on the Bank of the Philippine Islands for the disposal of treasury shares that came as a result of its merger with BPI Family Savings Bank.

In a disclosure sent to the Philippine Stock Exchange on Thursday, BPI said they received a letter from the BSP on June 13, which stated out the details of the penalty.

The BSP indicated that BPI failed to comply with Section 10 of Republic Act No. 8791, or the General Banking Law of 2000. 

As it is, BPI explained that they disclosed on September 29, 2022, that they will not pursue the proposed amendment on its articles of incorporation to trim its authorized capital stock by disposing of treasury shares. 

The disclosure was made since the BSP “did not favorably endorse” BPI’s request to dispose treasury shares that came from its merger with BPI Family Savings Bank. 

The central bank indicated that the retirement of these treasury shares cannot be considered a sale or disposition of shares, in line with Sec. 10 of the General Banking Law of 2000.

By then, BPI told the BSP that they approved the declaration of property dividends to stand as BPI’s way of disposing the treasury shares. This move, according to BPI, will only be completed once they secure approval from regulators. 

Shares in BPI closed trading up 0.96% to P105 per share on Thursday. — Ramon Royandoyan