MANILA, Philippines -- The remaining stumbling block to the merger between tycoon Lucio Tan's banking units Philippine National Bank and Allied Banking Corp. has been addressed as the latter found a buyer for its minority stake in a California-based bank.
In a disclosure to the Philippine Stock Exchange Wednesday, Allied Bank said its board of directors had approved the sale of a 27.78 percent stake in Oceanic Holding NVI Ltd. to a new investor identified as an individual named John Kim Chuy Ng.
The sale of the stake, equivalent to 5,000 shares in Oceanic Bank, would still be subject to approval by US regulators, the disclosure said. The price consideration was not given but earlier estimates valued the small but crucial stake at about $30 million.
Allied Bank was required by US banking regulators to divest its stake in Oceanic Bank prior to its union with PNB, which would be the surviving entity in the forthcoming merger. PNB was willing to buy the stake but American regulators did not want a Philippine bank to take over the stake in the American bank.
This requirement caused the delay in the completion of the PNB-Allied Bank merger, which was targeted to happen by end-2008. The financial meltdown in the United States in late 2008, in particular, made it difficult for Allied Bank to find a buyer for its Oceanic Bank stake.
The disclosure did not provide details on the new investor. It was earlier reported that US banking regulators were amenable to having private individuals buy out Allied Bank's stake.