CAGAYAN DE ORO CITY (MindaNews/26 March) — The Bangko Sentral ng Pilipinas (BSP) will be infusing P2.5-billion rehabilitation fund to strengthen the country’s cooperative banking industry.
“The BSP rehabilitation fund will come as preferred shares in selected cooperative banks that are stable,” said Ating Koop party list Rep. Isidro Q. Lico.
These strong cooperative banks, he added, will invest this money in ailing cooperative banks in order to rehabilitate them, he added.
“We were able to convince BSP that these ailing coop banks should be rehabilitated so that equity funds invested by the ordinary people will be saved. We have asked the BSP to provide a P2.5-billion rehabilitation fund,” said Coop-NATCCO Party-list Rep. Cresente Paez.
The BSP had revealed in a recent congressional hearing that there are 15 cooperative banks around the country that are in danger of foreclosure and are now placed under “Prompt Corrective Action” (PCA) by the BSP.
The BSP rehabilitation program also encourages the participation of strategic third-party organizations like primary coops and coop federations and encourages mergers and consolidation to create strong a cooperative banking industry.
The country’s biggest community cooperative, the First Community Cooperative (Ficco), has already been rehabilitating ailing cooperative banks around Mindanao.
Ficco is now the majority shareholder of the Cooperative Bank of Misamis Occidental in Oroquieta City, Cooperative Bank of Davao del Sur in Digos City and Cooperative Bank of Surigao del Sur in Bislig City.
Ficco Chief Executive Officer Vicente Rana said they have invested about P200 million to rehabilitate these coop banks. Ficco’s net worth now is pegged P4.3-billion.
Rana said that they are now in the final stages of the merger of the three cooperative banks under the name First Consolidated Cooperative Bank.
“We are just awaiting final approval from the BSP to merge these three banks under the name First Consolidated Cooperative Bank. The Philippine Deposit Insurance Corporation has already approved our application,” Rana told MindaNews.
Meanwhile, at least two cooperative banks will be joining the First Consolidated Bank once it starts operations.
“We are expecting the BSP approval of the Ficco application to operate a bank next month,” said Isagani Daba, President and CEO of the Metro South Cooperative Bank based in Manila.
Once the BSP approves the Ficco application, Metro South and the Cooperative Bank of Cebu will join the merger to create the first cooperative bank with nationwide coverage, Daba told MindaNews.
This development is eventually geared towards creating a single cooperative banking industry in the country, Daba said. (BenCyrus G. Ellorin/MindaNews)
