Keppel outbids Bank Lippo to take control of RP bank

Keppel outbids Bank Lippo to take control of RP bank

MANILA (Reuter): Singapore's Keppel Corp has outbid Bank Lippo of Indonesia, to snap up control of the ailing Monte de Piedad and Savings Bank, a Philippine central bank official said yesterday.

"For all intents and purposes, it's a done deal," he said.

Bank Lippo on Wednesday offered to pump 1.0 billion pesos into the troubled bank. But Keppel had agreed to match that and provide funds to cover unfunded "manager's cheques" issued before the bank was closed.

The Central Bank had earlier given banker Vicente Tan, the majority owner of Monte de Piedad, until 9.35 p.m. on Wednesday to match the offer if he wanted to retain his shareholding.

The official said he expected Keppel to take majority control with a local partner, presumably Tan.

He noted that the deal would give Keppel, which had earlier considered a banking presence here, 31 bank branches in the Philippines.

No Keppel official was immediately available for comment.

The official said an agreement would be signed later in the morning with the Central Bank.

If the new owner did not agree to honor unfunded cheques it would be up to the Central Bank to meet the bill once the Monte de Piedad reopened.

Keppel would use either cash or collateral to cover the cheques, the official added.

Keppel had also promised to try to reopen the bank on May 8, a pledge made by Lippo in its bid.

Lippo had offered to acquire Tan's 86.9 percent common shareholding and 71.2 percent preferred shareholding in the thrift bank for only one peso.

Monte de Piedad was temporarily closed two weeks ago after a run on its deposits following reports it had 1.8 billion pesos worth of uncollected loans extended to tricycle operators and drivers.

Two local companies had also put in bids.

Monte de Piedad used to be majority owned by the Archdiocese of Manila. The Church sold its majority stake to Tan in September 1995.