Bidding to Rehabilitate Export and Industry Bank

The Philippine Deposit Insurance Corp. announced Tuesday preparations for the bidding to rehabilitate the closed Export and Industry Bank is on track and proceeding smoothly.

It said the bidding for the bank’s rehabilitation is on Oct. 18, 2012, at the PDIC Office in Ayala Avenue, Makati City.

PDIC launched the rehabilitation process after strategic third party investors expressed interest to rehabilitate EIB.

The PDIC said that STPIs who have been pre-qualified to participate in the bidding may bid on the first tranche covering the purchase of EIB’s assets (including its branches) and assumption of liabilities.

The second tranche of the bidding will be for EIB’s commercial bank license.

The two-tranche bidding process is intended to maximize recovery for the benefit of the bank’s creditors.

The bidding process for the second tranche will commence in the next two weeks.

The PDIC Board has approved the general framework for the bidding process to ensure transparency and attract the best bid from qualified STPIs.

The Bidding Procedures for the first tranche are now being finalized and will be released next week through the PDIC website,

PDIC President Valentin A. Araneta said that PDIC continues to address the concerns of both pre-qualified STPIs and depositors to ensure a successful bidding.

Araneta said there are critical requirements for the rehabilitation of EIB.

These are: (1) support from the STPIs that will bid for the rehabilitation of EIB; 2) consent of majority of stockholders; (3) consent of all creditors and uninsured depositors; and 4) successful bidding.

Interested parties have been pre-qualified based on their financial and management capability.

Pre-qualified STPIs have completed due diligence audit on EIB and are now making preparations for the bidding.

He also disclosed that there is a sufficient number of STPIs to proceed with the bidding.

Pre-qualified STPIs have to submit a rehabilitation plan that complies with the requirements for capital strengthening, liquidity, sustainability and viability; and governance.

EIB stockholders have also manifested support for the rehabilitation.

The PDIC said it is discussing with the bank’s stockholders the documents to be executed by the stockholders.

It was reported that PDIC also conducted meetings with EIB’s uninsured depositors to discuss the status of EIB, the prospects and requirements for the bank’s rehabilitation, in particular, their consent for the rehabilitation and possible restructuring of their deposits.

To date, 35% of the depositors have already submitted the required consent, while others have signified that they will submit their consent as soon as possible.

PDIC earlier targeted the bidding to be conducted in the second half of Sept 2012, but decided to give creditors and uninsured depositors more time to submit their consents.

While depositors have expressed support for the rehabilitation of EIB, delays in the receipt of consents have been experienced due to depositors’ individual circumstances.

Around 15% of depositors could not be reached because of incomplete and outdated addresses and contact details in the bank’s records.

Araneta announced PDIC will continue to receive consents, and depositors may submit their consents to the Records Control and Logistics Dept., 4/F SSS Building, 6782 Ayala Avenue cor. V.A. Rufino St., Makati City (Attention: Assistant Vice President Teresa H. Garcia).

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