Instead of privatizing Philippine Postal Savings Bank (Postbank), the government plans to have it absorbed by state-run Land Bank of the Philippines next year to serve as a subsidiary catering to overseas Filipino workers, Finance Secretary Carlos G. Dominguez III said.
Dominguez, who chairs Landbank, told reporters that the Department of Finance already gave its go-ahead for Landbank to acquire the Postbank from Philippine Postal Corp.
“Landbank is a universal bank and universal banks reach out to different markets just like BDO bought One Network Bank so it can go to the rural market. We are going to do that, too,” Dominguez explained.
OFW market
“[Postbank] will be operated as a fully owned subsidiary and it will be serving an underserved market—the OFWs. It has a very good tie-up right now with the postal service so that would help in its marketing efforts,” the finance chief added.
Dominguez said Landbank would fit into the picture as “we don’t have any other bank to do it—DBP [state-run Development Bank of the Philippines] is not a universal bank.”
Additional capital
The finance chief said the government might have to infuse additional capital into Postbank to beef it up, but they have yet to determine how much. “It’s like giving your child some money—it’s still for yourself,” he said.
It would take about 11 months to conduct due diligence on and get a valuation of Postbank as well as get the Bangko Sentral ng Pilipinas’ nod for Landbank’s acquisition of Postbank, Dominguez said.
According to its website, Postbank has 31 branches and microfinance banking offices nationwide.
As of end-September, Landbank is the country’s fourth biggest bank in terms of assets with P1.29 trillion.