4 groups eye Phil Bank of Communications

Four big commercial banks – Banco de Oro Universal Bank, Rizal Commercial Banking Corp. (RCBC), Metropolitan Bank and Trust Co. (Metrobank) and an unidentified publicly-listed commercial bank – have reportedly expressed interest in acquiring the Philippine Bank of Communications (PBCom).

Banking sources said while PBCom is not in financial trouble, it still needs some P10 billion in additional capital to remain competitive under the stiff banking environment in the country.

Sources said the four commercial banks are particularly interested in PBCom’s niche market which includes the Filipino-Chinese business community and highly-placed government officials.

The three named commercial banks have, in fact, been known to handle huge Fil-Chinese accounts which eventually carried them through the Asian financial crisis in 1997.

According to monetary and banking officials however, PBCom’s existing stakeholders have expressed verbal commitment to infuse P3 billion in additional capital into the bank.

Bangko Sentral ng Pilipinas (BSP) deputy governor Alberto V. Reyes and PBCom president Isidro C. Alcantara said stockholders committed yesterday to inject fresh capital, simultaneous with the disposal of the bank’s non-performing assets (NPAs).

"Our shareholders agreed in principle to increase our capital. It shows their commitment to the bank," said Alcantara.

In a separate interview, Reyes said PBCom will be forming a special purpose vehicle (SPV) to get rid of its non-performing loans (NPLs) even as it puts up at least P3 billion in fresh funds.

"They have committed to inject fresh capital, which will be done simultaneous with the sale of their NPLs through the SPV," Reyes said.

PBCom reportedly incurred a net loss of P85.35 million as of end September. Total resources grew to just P50 billion this year from P34 billion at the start of 2000.

Its NPL ratio stood at 24 percent or about P6 billion, which is higher than the industry average of around 15 percent.

PBCom is reportedly holding exploratory talks with the Philippine Deposit Insurance Corp. (PDIC) for assistance, replicating the blueprint for United Coconut Planters Bank.

However, PDIC has reportedly tossed the idea back to the BSP. The BSP seems to be interested as long as the assistance will be given after the conduct of a special examination.

But Alcantara denied holding talks with the two government monetary authorities.

"The SPAV and the commitment of our shareholders to inject fresh capital are more than enough to allow us to grow," Alcantara said.

PBCom, in its report to the stock exchange last weekend, said it will front-load the bulk of its liquidity requirement until year-end, due to the projected sharp rise in interest rate this quarter.