The Bangko Sentral ng Pilipinas (BSP) has released updated templates to guide and assist bank mergers and consolidations.
In a memorandum (Ordinance Memorandum No. M-2022-047), BSP Deputy Governor Chuchi G. Fonacier stated that candidate banks for merger and consolidation will indeed comply with the documentary requirements set forth in the ” Harmonized list of requirements for simplified procedures for applications”. for bank mergers, consolidations and acquisitions” with the use of models.
“The templates are general in nature and updated to comply with the requirements of banking laws, BSP rules and regulations, the Revised Companies Code of the Philippines and the Philippine Cooperative Code, as applicable,” Fonacier said.
She added, “Nevertheless, the Constituent Banks may include such provisions as may be necessary, taking into account their mutual agreements and other arrangements.”
Fonacier also pointed out that the examination of merger and consolidation requests is done on a case-by-case basis – “notwithstanding the use of said models”.
The BSP and four other financial regulators agreed last year to streamline bank merger, consolidation and acquisition processes to bolster the government’s long-standing fight against bureaucracy or excessive regulation that hampers business.
This initiative was initiated by the Philippine Deposit Insurance Corp., then joined by the Securities and Exchange Commission, the Cooperative Development Authority and the Philippine Competition Commission.
Regulators agreed to simplify and reduce procedures from 58 documentary requirements to just 30. They also agreed to reduce the processing time for merger and consolidation proposals to 55 working days from 160 days.
Fonacier said the updated templates amended a 2015 circular letter on 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 the financial soundness and improve the viability of FIs, strengthen the management and governance of FIs and to extend the reach of FIs in the market,” said Fonacier. .
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