UCPB sale on track, says PMO chief

The privatization of the government’s controlling stake in United Coconut Planters Bank remains on track despite a temporary restraining order (TRO) issued by the Supreme Court last Tuesday to stop the implementation of two recently issued executive orders on the controversial coco levy fund.

In a text message, Chief Privatization Officer Toni Angeli V. Coo said the Privatization and Management Office (PMO), which is in-charge of disposing of the government shares in UCPB, “wants to confirm the contents (of the Supreme Court TRO) because UCPB’s recapitalization is implementing various executive and legislative matters.”

Coo said the privatization of UCPB was “part of the plan of the government since 2008 when the Bangko Sentral ng Pilipinas approved assistance” to the bank.

The disposal of the government stake likewise implements the GOCC Governance Act of 2011, which gave the Governance Commission for Government-Owned or -Controlled Corporations (GCG) the mandate to recommend such action to the President, Coo added.

“The GCG’s recommendation is also due to the Supreme Court decision that found UCPB to be majority owned by the Republic of the Philippines,” she pointed out.

The sale of the government’s UCPB stake is being facilitated by Executive Order No. 179 issued by President Aquino last March, alongside an earlier approval made by the GGC and the Supreme Court’s entry of judgment on the case involving San Miguel Corp. shares granted last December.

Last week, the PMO moved to July 16 from June 30 the deadline for submission of pre-qualification documents by prospective bidders for UCPB, Coo said, citing that the agency had recognized that “the (previous) schedule was tight.”

The PMO on June 17 received 12 letters of intent from a mix of local and foreign banks and private equity firms interested to buy UCPB, the 12th largest bank in the country with more than 200 branches and about P260 billion in assets.

The government is disposing of its UCPB stake through a privatization scheme that will require the winning bidder to acquire the government’s equity in it and infuse fresh capital into the bank.

The transaction would require the winning bidder to recapitalize the bank in the amount of at least P15 billion through subscription to up to 37.2 billion primary common shares of UCPB.