DBP chair questions merger with LandBank

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The chairman of state-run Development Bank of the Philippines on Tuesday described the study that recommended its merger with Land Bank of the Philippines as “legally erroneous”, saying it was done with inordinate haste and encroached on the mandate--

Bank of the Philippines as “legally erroneous”, saying it was done with inordinate haste and encroached on the mandate of the Office of the Solicitor General and the Office of the Government Corporate Counsel.

It said the merger proposed by Finance Secretary Benjamin Diokno was strongly opposed by officials and employees of the DBP, most of whom would lose their jobs if the merger would push through, with LandBank as the surviving bank.“If merger is inevitable, the DBP, with its richer legacy, more extensive experience and expertise and better track record in development financing, is more deserving to be better surviving bank,” the paper said.

“The Supreme Court has already upheld the authority of the Governance Commission for GOCCs to merge GOCCs in its Lagman v. Executive Secretary ruling upon finding that it is to the best interest of the state,” he said. It said that on the authority of the CG in relation to the merger or reorganization of GOCCs under Section 5 of R.A. 10149, such authority is merely recommendatory to the President.

It said that as Department of Finance secretary, Diokno is an ex-officio member of GCG to which the merger proposal was submitted. He is the ex-officio chairman of LBP and will remain so after LBP becomes the surviving “superbank” following the merger, it said.

 

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