President Ferdinand “Bongbong” Marcos Jr.’s order to merge Land Bank of the Philippines (Landbank) and Development Bank of the Philippines (DBP) is not legally binding without the approval of Congress.
Albay Rep. Edcel Lagman said Congress must pass a law to merge the two state-owned banks.
“Only Congress can amend or repeal statutes. The projected merger cannot legally be effected by a mere Executive Order,” Lagman said in a statement.
Lagman pointed out that the two banks have separate legislative mandates: Landbank was created under Republic Act No. 3844 of 1963, while DBP was established under Republic Act No. 2081 of 1958.
Lagman said Congress must amend the respective charters of Landbank and DBP to effect the merger, and a mere Executive Order from the President will not suffice.
Finance Secretary Benjamin Diokno is targeting to complete the merger before the end of this year.
“Following the approval of the GCG (Governance Commission for Government Owned or Controlled Corporations), we now await the issuance of an Executive Order sometime this month,” Diokno said in a briefing.
“There will be a joint crafting and approval of the Operational Integration Plan in September, followed by the approval of the Monetary Board in October, before the final legal merger between Landbank and DBP by November,” he said.
The merger will create the country’s largest bank with P4.18 trillion assets and eclipse the biggest trillion-peso bank, BDO Unibank.