Sen. Win Gatchalian during a Senate meeting. Senate PRIB file photo / Bibo Nueva Espa帽a
MANILA, Philippines 鈥� Senator Sherwin Gatchalian has filed a resolution seeking an inquiry into the proposed merger between the Land Bank of the Philippines (Landbank) and the Development Bank of the Philippines (DBP), saying that the Senate has to check whether a union would be better for both banks.
Gatchalian on Friday said he has filed Senate Resolution No. 697 as the Senate should weigh in if the merger would mean serving the banks鈥� customers better, and help in the development of micro, small, and medium enterprises (MSMEs).
鈥淭here is a need for the Senate to weigh in on whether the merger of these two government banks will better serve the country鈥檚 development needs in the agriculture, infrastructure, and industrial sectors, particularly among the micro-small-and-medium enterprises, and to ensure that the proposed merger will not dilute the government鈥檚 focus on developing these target sectors,鈥� Gatchalian said in the resolution.
According to Gatchalian, chair of the Senate Committee on ways and means, the legislative chamber also needs to verify concerns about the potential risks surrounding the merger 鈥� especially amid discussions regarding stability and possible impact to the financial sector.
鈥淭he Senate also needs to look into concerns on the potential risks the contemplated merger may bring to the stability of the banking industry and the economy, as the consolidation of these banks to form the largest bank in the country could concentrate risks and increase vulnerability to financial market stress and economic shocks,鈥� he added.
It could be remembered that Finance Secretary Benjamin Diokno proposed the Land Bank-DBP merger in March, claiming that it would 鈥渃reate a bigger, stronger, and more resilient bank that can better serve the country鈥檚 development needs鈥�.
It was also said back then that a legislated law is no longer needed to ensure the merger.
Diokno said that once the two banks are merged, it will become the biggest in the Philippines, with an estimated asset size of about P4.18 trillion.听 It is also expected to eliminate redundancies and inefficiencies in operations, leading to a projected annual savings of P5.3 billion.
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Gatchalian noted that the Governance Commission for Government-Owned or -Controlled Corporations (GCG) affirmed that the proposed Land Bank-DBP merger did not necessitate new legislation as existing laws grant the President the authority to carry out such an action.
However, the DBP in April insisted that the merger must be passed through legislation in Congress rather than through the President and the GCG.
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In his proposed Senate Resolution No. 697, Gatchalian said that the government should ensure that the operations of the Government-Owned or -Controlled Corporations are rationalized and monitored to optimize the use of government assets and resources.听With reports from Kirsten Segui, 黑料社 trainee
READ: Landbank-DBP merger needs law, not just EO, says lawmaker听