Ongpin-led ISM to get majority stake in PBCom

Ongpin-led ISM Communications Corp. is set to buy out shareholders in the Philippine Bank of Communications after acquiring 67 percent of PBCom and upon submitting the names of its directors and senior managers to the bank’s board, all of whom must pass the “fit and proper" standards as required by law. ISM Corp. president and former Trade Minister Roberto Ongpin told the Philippine Stock Exchange on Thursday that Macquarie Capital Advisers had informed the company that the major shareholders of PBCom have chosen ISM to be the buyer of their collective stake in the lender. "... [T]he Luy Group, the Chung Group and the Nubla Group (collectively the major shareholders) have decided to select the ISM Communications Corp. as the Philippine Bank of Communications' major strategic third party investor, subject to regulatory approvals," said a letter addressed to Roberto V. Ongpin, ISM chairman, and sent by Michael de Guzman, Macquarie Capital (Singapore) managing director. PBCom had been able to continue operations after the Philippine Deposit Insurance Corp. extended the bank a P7.6 billion emergency financial assistance package back in 2006 on condition it sell at least 67 percent of its equity to new owners after five years. ‘Fit and proper’ rule Bangko Sentral ng Pilipinas officials said also on Thursday that there are no restrictions preventing service companies or telecommunications firms from owning banks, provided they comply with applicable rules and regulations. BSP managing director Johnny Noe Ravalo said it was important for the bank’s board of directors to qualify under the so-called “fit and proper rule" imposed by regulation because they set policy and must ensure that governance standards are observed stringently. “There is a vetting process that ensures everyone in that board passes the fit and proper standard," he said. Senior bank managers must also undergo a similar vetting process with their more senior colleagues in the board. This is necessary, Ravalo said, because these people have oversight responsibilities on the daily operations and other aspects of running a bank. These names are checked against a “negative" list of people who are either temporarily or permanently barred from holding any post in any bank under BSP supervision. The major shareholders of PBCom had been seeking to sell their stake to fulfill a condition of the P7.6-billion assistance given to it by the Philippine Deposit Insurance Corp. in 2004. Earlier, Banco de Oro Unibank also expressed interest in acquiring PBCom's majority stake. — CMA/OMG/MRT/VS, GMA News