Gov’t stake sale in UCPB seen as shot in arm

United Coconut Planters Bank (UCPB) on Monday welcomed the impending sale of the government’s controlling stake in the lender after overcoming a legal obstacle.

“This will definitely redound to the benefit of UCPB and its clients as this will strengthen the bank’s capital and generate more resources to improve its competitive position in the market,” the bank said in a statement.

Last week, Finance Secretary Carlos G. Dominguez III said the government would finally jump-start the privatization of UCPB, which he said they were currently supporting with deposits in excess of P40 billion. He said the bank would be privatized via a recapitalization program and sale of the government’s stake.

The Supreme Court lifted this month the halt order it issued two years ago against two executive fiats under former President Aquino that ordered the disbursement of coco levy funds.

“We will be coordinating closely with the DOF for their next steps, and will provide updates to all our stakeholders as we do so,” UCPB added.

“We would like to assure our clients that it is business as usual for the bank while we go through each phase of this much-awaited recapitalization program, and that they can look forward to a better and stronger UCPB,” the lender said.

To recall, the high court in June 2015 put on hold the implementation of executive orders 179 and 180, which would have set into motion the privatization and reconveyance to the government of about P74.3 billion in coco levy funds.

The following month, the Privatization and Management Office (PMO) announced it “temporarily suspended” the planned sale of the government stake.

The latest ruling from the SC, in effect, bolstered an earlier decision that the coco levy funds were public in nature.