The Governance Commission for Government-Owned and Controlled Corporations (GCG) expressed openness to any inquiry on the proposed merger of Land Bank of the Philippines with the Development Bank of the Philippines (DBP).
In a statement on Tuesday, the GCG said it welcomes inquiries as it will help inform the government's decision on the proposed merger of its two largest banks.
"We welcome all resolutions, inputs, and studies that will provide the Commission better understanding and information to determine whether it is appropriate to merge the concerned government financial institutions (GFIs),” said GCG Commissioner Gideon Mortel.
Last week, the GCG submitted to the Office of the President the result of its legal study which says the merger of Landbank and DBP can proceed without legislation and can be done through an executive action.
The study, in particular, says that Republic Act No. 10149 or the GOCC Governance Act of 2011, among other legal bases, statutes, and applicable jurisprudence, empowers the GCG to ascertain whether such GOCCs should be merged.
Meanwhile, Senate Deputy Minority Leader Risa Hontiveros has filed a resolution seeking an inquiry, in aid of legislation, into Landbank-DBP merger proposal.
Hontiveros raised concerns about the potential risks and benefits that it may bring to the economy, the stability of the financial system, and various stakeholders, including the employees of both banks.
With this, Mortel said that any further inquiry on the proposed merger will provide better light on whatever determination GCG would have.
Finance Secretary Benjamin Diokno announced in March 2023 that the government was planning a merger between the two state-run financing institutions, with the Landbank as the surviving entity.
The merger is expected to create the largest banking institution in the country, with a total of more than P4.179 trillion in assets.
Mortel clarified that the GCG legal study submitted to the Office of the President only resolves whether the merger requires legislation.
It does not indicate just yet any decision from the Commission regarding the proposal for merger, the GCG official said.
He said that the GCG is still studying the positions of its stakeholders such as the Philippine Competition Commission, Commission on Audit, Department of Finance, Landbank, and DBP.
Mortel said the agency is looking into various aspects of the proposed merger, including operational efficiency, market reach, enhancement of new product lines, and geographic reach.—AOL, GMA Integrated News