The Governance Commission for Government Owned or Controlled Corporations (GCG) said it welcomes inquiries that will help inform the government on the proposed merger of the Land Bank of the Philippines (LANDBANK) and the Development Bank of the Philippines (DBP).
“We welcome all resolutions, inputs, and study that will provide the Commission better understanding and information to determine whether it is appropriate to merge the concerned government financial institutions (GFIs),” said GCG Commissioner Gideon D. V. Mortel.
The GCG recently submitted to the Office of the President a legal study that says that the proposed merger of LANDBANK and DBP can be done through executive action.
The study says that Republic Act 10149 or the GOCC Governance Act of 2011, among other legal bases, statutes, and applicable jurisprudence, empowers the GCG to ascertain whether such GOCCs should be merged.
In a resolution on Tuesday, 17 April 2023, Senator Risa Hontiveros called for an investigation, in aid of legislation, into the proposed merger.
Senator Hontiveros raised concerns over the potential risks and benefits the merger may bring to the economy, the financial system, and stakeholders.
Commissioner Mortel said that any further inquiry on the proposed merger will provide better light on whatever determination the GCG would have.
Finance Secretary Benjamin Diokno announced the proposed merger in March, with LANDBANK as the surviving entity. The merger is expected to create the largest banking institution in the country with assets of more than P4.179 trillion.
Commissioner Mortel clarified that the legal study submitted to the President only resolves whether the merger requires legislation and did not indicate the Commission’s stance on the proposal for merger.
According to him, the Commission is still studying the positions of stakeholders as the Philippine Competition Commission, the Commission on Audit, the Department of Finance, LANDBANK, and DBP.
The Commission is looking into various aspects of the proposed merger, including operational efficiency, market reach, enhancement of new product lines, and geographic reach, he added.
