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PDIC is
of course the Philippine Deposit Insurance Corp., the
co-protector of millions of banking clients, being the
Bangko Sentral ng Pilipinas’s (BSP) coregulator of all
banks and a key stabilizing institution of the country’s
financial system.
PBCom,
on the other hand, is the Philippine Bank of
Communications, one of the country’s oldest commercial
banks majority owned by the Nubla and Chung families
which had to secure a P7-billion PDIC-bridge financing
some years back after it experienced a mild run. This
resulted, according to some banking sources, mainly from
serious disagreement on the bank’s imposed
rehabilitation among its major shareholders which, at
that time, already included the group of Cebu
businessman Douglas Lu Ym.
That
PDIC rehabilitation scheme carried certain covenants,
one of the most important being the commitment of the
three major shareholders to sell their shares as a group
and when needed, but not later than five years after the
approved rescue arrangement.
Phoenix
is Phoenix Petroleum, a Davao-based petroleum products
and logistics company, which, until the SEC and the PSE
approved its IPO a week ago, was unknown outside its
home base.
So, why
are we talking about them in this piece? Well, for the
simple reason that they have been hogging the headlines
these past few days for differing reasons and their
saga, as it were, mirrors the problems of transparency
and governance in both the public and private sectors.
More
importantly, how they will face up to their
responsibilities in the weeks, maybe months and even
years ahead, will definitely impact on such key sectors
as banking and finance, and oil and power.
Let us
first dwell on the good news—the seemingly unstoppable
run of Phoenix Oil. Apart from working its way to be the
biggest independent petroleum products distributor in
Mindanao, the company has apparently taken pains to tie
up with internationally known oil players outside of the
Big Four (Petron/Aramco, Shell, Caltex and Total) to
solidify its standing.
It has
an outstanding agreement with PTT Thailand to operate
and manage the latter’s service stations nationwide. It
has also tied up with Emarat Oil, the Dubai-based oil
products company, which has established a name for
itself as a serious and expansion-minded player out to
capture even more market share from the traditional
players wherever they may be.
Some
observers note that pretty soon, if the Big Four do not
watch out, Phoenix Oil may just capture their base
clients on the island and proceed to get into Luzon and
Visayas in no time at all. That should be welcome news,
if you ask me, and proof positive that oil deregulation
is alive and kicking after years of being in the
doldrums. It is not surprising then why we are now being
told that the company’s IPO has been oversubscribed and
how!
And now,
to the distressing news—the case of PDIC and PBCom. The
issue, which finally came to a head this week, is
straight forward. Did the latter or to be more precise,
the Nubla and Chung families, violate the terms of their
PDIC-imposed rehabilitation by disposing of their
majority (58 percent) share in the bank through the
simple expedient of electing a new set of board members?
The new board already included the representatives of
the reported buyer, Manila Bulletin and Philtrust owner
Don Emilio Yap, without the consent of the regulatory
agency.
And if
so, what has, or should we say, what is the PDIC, which
is supposed to protect the bank’s clients and the health
of the banking system, doing about it?.
From the
information filtering out of both the PBCom and PDIC the
answer is clear: these institutions have seemingly
conspired to defeat the terms of the multibillion
rehabilitation scheme. In the process, both committed
grave injustice to all PBCom stakeholders, including the
thousands of bank depositors and clients and, yes, the
public whose money the PDIC used to rescue the bank in
the first place.
By
disposing of their majority shares but not in tandem
with the Lu Ym group as mandated by the PDIC
rehabilitation plan, they run afoul of that scheme.
Moreover, by so doing without written permission from
the PDIC itself it has put the fate not only of the
shareholders and their clients but the entire banking
system in jeopardy. How so?
Well, if
the Nubla and Chung families did not even have the
courtesy or, should we say, decency of informing and,
yes, securing the agreement of the other shareholders
and the PDIC of the terms of the transaction, how on
earth can they even claim that they have the best
interest of their clients and the banking public at
heart as their publicists are now feverishly trying to
suggest? And why did they do so on the sly?
Up to
now, nobody not even the PDIC have been apprised of the
terms of the takeover. And, if ever, who gave them the
go ahead, the nod and the wink, to proceed as they did
knowing full well that they will be exposed for what
they did?
In a
word, why the sly moves and the open defiance of the
terms of their rehabilitation? One can only guess why.
But at this point there is no question that by doing so
the proponents (and that includes the reported buyer)
have invited more suspicion than necessary—something
which will negatively impact on the bank’s fate and the
banking system as well. This and the more serious act of
negligence or, worse, complicity of the PDIC should not
go unpunished at all.
Silence
or inaction are not acceptable options and newly
appointed PDIC president Michael Osmeña knows it. We
await with bated breath the resolution, if at all, of
this distressing banking maneuver. |
