PNB eyes strategic investor after merger with Allied Bank

Philippine National Bank may take in a strategic investor only after completing its merger with Allied Banking Corp. within the next 18 to 24 months, according to its, according to its acting president, Omar Mier.

MANILA, Philippines—Philippine National Bank, the banking arm of tycoon Lucio Tan, may take in a strategic investor only after completing its merger with Allied Banking Corp. within the next 18 to 24 months.

Acting PNB president Omar Mier said any merger and acquisition would likely proceed only once the two banks have merged.

Asked if there were still ongoing discussions with various parties for potential merger and acquisition deals, Mier said: “You get investment banks talking to you but these are exploratory. We keep on receiving all of these but (there’s) nothing definite.”

The Lucio Tan group had been in talks with the Ayalas on a prospective Bank of the Philippine Islands-PNB union but the exclusivity period lapsed last September, opening the door to new suitors.

But Mier said the priority would be to have an efficient integration with Allied Bank in order to boost profitability.

Other industry sources said the framework earlier mapped out for BPI to take over a merged PNB-Allied Bank was not acceptable to the group’s patriarch. While Tan was willing to take in strategic partners in PNB, they said the most acceptable model was the one done for the tobacco business in which the group gave up management control but kept a 50-percent stake in the combined entity.

A PNB-Allied Bank entity would have combined assets of about P560 billion and 671 branches, Mier said. It will also have the biggest overseas footprint of 115-120 offshore units.

PNB recently hurdled the remaining local and foreign regulatory approvals needed to finally implement a legal merger with Allied Bank starting next month.