The Bangko Sentral ng Pilipinas (BSP) has issued updated templates to guide and assist banks’ merger and consolidations.
In a memo (Memorandum Order No. M-2022-047), BSP Deputy Governor Chuchi G. Fonacier said applicant banks with merger and consolidations will effectively comply with the documentary requirements stated in the “Harmonized List of Requirements of the Streamlined Procedures for Applications for Mergers, Consolidations and Acquisitions of Banks” with the use of the templates.
“The templates are general in nature and updated to comply with the requirements of banking laws, BSP rules and regulations, the Revised Corporation Code of the Philippines, and the Philippine Cooperative Code, as applicable,” said Fonacier.
She added, “nonetheless, constituent banks may include provisions as may be necessary, taking into consideration their mutual agreements and other arrangements.”
Fonacier also emphasized that the review of the merger and consolidation applications are on a case-to-case basis – “notwithstanding the use of the said templates.”
The BSP and four other financial regulators have agreed last year to streamline banks’ merger, consolidation, and acquisition processes to strengthen government’s long-standing fight against red tape or over-regulation that hinders businesses.
The move was initiated by the Philippine Deposit Insurance Corp., and later joined by the Securities and Exchange Commission, the Cooperative Development Authority and the Philippine Competition Commission.
The regulators agreed to simplify and trim procedures from 58 documentary requirements to just 30. They also agreed to cut the processing time for mergers and consolidation proposals to 55 business days versus 160 days.
Fonacier said the updated templates amended a 2015 circular letter on the said subject templates.
This was to pursue BSP’s mandate of maintaining a “stable and efficient banking and financial system that is globally competitive, dynamic and responsive to the demands of a developing economy.”
“The BSP, through mergers, consolidations and acquisitions of banks aims to develop larger and stronger financial institutions (FIs), improve financial strength and enhance the viability of FIs, strengthen management and governance of FIs and expand market reach of Fis,” said Fonacier.