THE Philippine Deposit Insurance Corp. (PDIC) has given its conditional approval for the merger of Ayala-led lenders Bank of the Philippine Islands (BPI) and BPI Family Savings Bank (BFSB), with BPI as the surviving entity. 

PDIC granted its condition consent through a letter dated July 6, BPI said in a filing on Friday. 

The consent granted by the PDIC Board of Directors to the proposed merger of BPI and BPI Family Savings Bank BFSB, with BPI as the surviving entity, shall be valid as long as the Monetary Board has approved the merger. The consent granted by the PDIC is one of the requirements of the MB in approving the merger.

To ensure the protection of depositors, the proponent banks are required to submit to PDIC within five business days from their receipt of the Monetary Board approval the notarized certifications that the proponent banks’ respective depositors and creditors have been duly notified of the approved merger and its full implication on the deposit liabilities and the rights of the depositors; and that the proponent banks have sufficient liquid funds to cover possible withdrawal transactions of depositors.

Aside from the PDIC and the Bangko Sentral ng Pilipinas (BSP), BPI also needs to secure the approvals of other regulators for the merger, including the Securities and Exchange Commission (SEC), Philippine Competition Commission, and the Bureau of Internal Revenue.  

BPI’s plan to absorb BFSB was announced in January and was approved by a quorum or at least two-thirds of BPI’s stockholders in April. 

The listed lender said they expect the SEC to approved its Amended Articles of Incorporation for the merger by October. The merger will be effective upon the SEC’s issuance of the Certificate of Merger or by Jan. 1, 2022. 

BPI’s net earnings dropped 21.64% to P5 billion in the first quarter from P6.381 billion a year earlier. This was caused by declining revenues amid lower net interest income. 

Its shares ended trading at P88.40 each on Friday, up by P1.40 or 1.61% from its previous finish. — LWTN 

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