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PHILIPPINE NATIONAL Bank (PNB) targets to complete the consolidation of its savings lending arm with the parent lender by mid-2019, as it is still working on regulatory approvals.
PNB Executive Vice-President Chester Y. Luy said the Lucio C. Tan-controlled lender expects to complete its absorption of PNB Savings Bank “before the second quarter…or perhaps first part of third quarter.”
“That is going well. We just need to have all the regulatory approvals in place,” Mr. Luy told reporters following PNB’s press briefing on Tuesday.
PNB announced in September last year that its board of directors approved the full integration of its wholly-owned thrift banking subsidiary into the parent lender.
The merger plan needs to be approved by regulatory agencies such as the Bangko Sentral ng Pilipinas and the Securities and Exchange Commission.
PNB said that the integration will allow the parent bank to “deliver a more efficient banking experience” and “serve a wider customer base,” while PNB Savings Bank clients will have access to the universal lender’s diverse financial services upon full consolidation.
“That is why we’re putting the savings bank back into the bank to allow ourselves to have a very good cover of the consumer finance business locally,” PNB President and Chief Executive Officer Jose Arnulfo A. Veloso said during the press briefing.
He added that the consolidation will also enable its overseas Filipino clients to “have a referral bank of the consumer finance means into the country.”
Thrift lenders like PNB Savings Bank mainly target individual borrowers and small businesses, which are deemed riskier but higher-yielding segments compared with corporate clients which commercial banks usually serve.
Rizal Commercial Banking Corp. is also set to absorb its thrift banking unit RCBC Savings Bank to reduce operating costs and consolidate capital. The merger is expected to be completed in the second half of the year.
The planned integration of PNB Savings Bank into the parent will bring PNB’s total number of branches to 711.
PNB Savings Bank was the sixth-biggest thrift bank in the country in asset terms as of end-2018 with P61.8 billion.
PNB posted a net income of P1.9 billion in the first quarter of the year, up 30% from P1.5 billion posted in the same quarter last year. The bank also posted a P1.03 billion as of end-March, 21% higher year-on-year.
PNB shares stood at P52.50 apiece on Tuesday, up 10 centavos or 0.19% from the previous close. — Karl Angelo N. Vidal