The government raised its majority stake in United Coconut Planters Bank from 75 percent to 97 percent with the conversion of the P12 billion in capital notes the bank issued to Philippine Deposit Insurance Corp. into special preferred shares, Finance Secretary Carlos Dominguez III said Friday.
Dominguez, who is also the chairman of the state-run PDIC, said the increase of the state’s majority shareholdings in UCPB reaffirmed the government’s commitment to support the bank.
“The Duterte administration has followed the policy of strengthening the capital bases and rationalizing the structures of all government-owned and –controlled banks, namely Land Bank [of the Philippines], DBP [Development Bank of the Philippines], OFBank and UCPB, with the objective of improving their level of service and value for their stakeholders, the Filipino people,” Dominguez said.
“This latest move of PDIC of converting the capital notes it held to more permanent special preferred shares in UCPB is totally in line with the above objective,” Dominguez said.
Dominguez said the remaining 3-percent stake was owned by “various private sector individuals and entities.”
UCPB obtained financial assistance from the PDIC as part of its recapitalization program, which included P12 billion in capital notes PDIC president Roberto Tan said.
“The capital notes are convertible to special preferred shares and the PDIC has exercised this option, effectively increasing the government’s shareholdings in UCPB to 97 percent,” Tan said.
Tan said that aside from PDIC’s infusion of financial assistance into UCPB, the Bureau of the Treasury also extended another P30 billion in deposit to provide income support to the bank.
Dominguez said he expected the board of UCPB to consider re-orienting their focus on serving the farmers and processors of coconut and other vegetable oil products, but balancing their portfolio with exposure to other industries and clients in the middle market.
