6 banks interested in buying Export Bank

Posted at 06/21/12 6:20 PM

MANILA, Philippines (UPDATED) - Six Filipino-owned commercial banks are interested in bidding for closed Export & Industry Bank, according to an official of the Philippine Deposit Insurance Corp. (PDIC).

PDIC executive vice president Cristina Orbeta said 6 banks, including Banco de Oro, have notified the PDIC of their intent to submit a rehabilitation proposal for EIB.

"There are several banks that expressed interest in rehabilitating EIB. We want them to participate in the due diligence process we [PDIC] are about to undertake,” Orbeta said.

PDIC is set to release the invitation for interested parties to conduct due diligence of EIB on Friday (June 22). Due diligence will begin on July 2, while the bidding for the rehabilitation of EIB is tentatively set for August.

The state-run deposit insurer will determine the rehabilitation proposal that will be most advantageous to depositors, creditors and taxpayers.

"As with any closed bank, a rehabilitation proposal for EIB should address the requirements for capital strengthening, liquidity, sustainability and viability, and governance," the PDIC said.

EIB, which was placed under PDIC receivership last May, still has P14 billion in deposits and 50 branches. Of the deposits, Orbeta said some P10.4 billion are not covered by deposit insurance.

The PDIC official said EIB's rehabilitation will help prevent loss of money for depositors.

Meanwhile, PDIC has appointed Alba Romeo & Co. as the financial auditor for the closed bank.

Alba Romeo & Co. is the Philippine affiliate of UK firm Binder Dijker Otte International,  one of the largest accounting and consulting organizations in the world with more than 600 offices in 100 countries.

"As financial auditor of EIB, the firm is expected to take full accounting of the assets and liabilities of the bank and ascertain the reasonableness of valuation and recoverability of assets and accuracy of liabilities," the PDIC said.

EIB depositors, who have account balances of P10,000 and above, started receiving their money on June 19. The "payout operations" are being conducted in 3 batches to cover 50 EIB branches.

The estimated total insured deposits of EIB is around P3.4 billion.