President Aquino has already approved the proposed Landbank-DBP merger and if the BSP approves it too, LANDBANK, as the surviving bank, will become the second biggest bank in the country, based on total assets, behind top ranking BDO. It will surpass Metrobank and BPI.
Based on BSP data as of September 30, 2015, Landbank was the 4th biggest bank in total assets and DBP was 7th.
Top 10 Commercial/Universal Banks, Based on Total Assets
|RANK||BANK||TOTAL ASSETS in||RANK|
Landbank Assets 1,139.846
DBP Assets 465.082
Merged Assets 1,604.928
Absorbing DBP’s 465.1-billion-peso asset into its own 1.14-trillion asset, Landbank will rise with 1.6 trillion in total assets, moving up to No. 2 in ranking, well above Metrobank and BPI.
Aquino also approved the proposed increase in Landbank’s authorized capital stock from 25 billion to 200 billion pesos to enable Landbank to absorb DBP.
Since Landbank and DBP Are State-Owned Banks, Why Was the Merger Not Deliberated on by Congress?
House Speaker Feliciano Belmonte Jr. questioned why the merger was carried out through an executive action and not through a law passed by Congress.
Senate President Franklin Drilon explained that the GOCC Reform Act empowered the President to merge, close or re-organize Government-Owned or Controlled Corporations (GOCCs) upon the recommendation of the Governance Commission for GOCCs (GCG), which operates under the Office of the President.
RA 10149 or GOCC Governance Act of 2011 empowered the GCG to ascertain whether it’s in the best interest of the state to merge GOCCs. EO 198 listed 4 reasons as basis for the merger, the first of which is the overlap of the functions of Landbank and DBP.