THE CONSOLIDATION of Rizal Commercial Banking Corp. (RCBC) and its thrift lending arm was approved by majority of its stockholders, which paves the way towards securing the necessary regulatory approvals.
In a plan of merger posted on the local bourse on Wednesday, the Yuchengco-led lender said at least 2/3 of its stockholders, during a special meeting on Feb. 26, approved the bank’s absorption of RCBC Savings Bank, Inc. (RSB).
“With the approval, regulatory approvals will be sought,” the bank disclosure read.
The plan of merger shall be subject to the approval of the Bangko Sentral ng Pilipinas, the Securities and Exchange Commission, the Philippine Deposit Insurance Corp., as well as the Bureau of Internal Revenue.
In September, the universal bank announced it will absorb RSB for “more efficient capital deployment” and “operational cost efficiencies.” In particular, RCBC said consolidating the two entities would mean “more efficient compliance with the Basel 3 liquidity ratios” set by the central bank.
The thrift bank is wholly owned by RCBC, with paid-up capital worth P3.19 billion.
RCBC expects to complete the consolidation on July 1, with the commercial bank assuming all assets and liabilities of RSB. As of this year, any net income or loss tallied by RSB until the effective date shall be declared to RCBC.
The consolidation comes ahead of higher capital and liquidity requirements in line with global standards imposed on big banks that took effect this year.
RSB was the country’s third-biggest thrift bank in asset terms as of end-September 2018 at P122.65 billion.
The Yuchengco-led RCBC saw its net income steady at P4.3 billion in 2018 from the previous year’s level, supported by increased lending across all segments.
RCBC shares stood at P26.60 apiece on Wednesday, up by 10 centavos or 0.38% from the previous close. — Karl Angelo N. Vidal