President Rodrigo Duterte has approved the merger of state-owned banks Land Bank of the Philippines (LBP) and United Coconut Planters Bank (UCPB).

The merger was approved through the president’s signing of Executive Order No. 142 on June 25.

Landbank will remain as the surviving entity after the merger, with all UCPB assets and liabilities to be transferred to it.

Landbank also acquires the preferred shares of the Philippine Deposit Insurance Corporation in UCPB.

Duterte said the merger would strengthen financial services to the coconut industry and the entire agricultural sector, as well as contribute to economic sufficiency, foster countryside development and financial inclusion, and promote stability in the banking system.

The two banks, in consultation with the Governance Commission for Government-Owned and -Controlled Corporations, will determine the mode of merger and implement the same with the approval of relevant regulatory agencies.

They were also ordered to prepare and implement an integration plan toward the full implementation of the merger, in accordance with existing laws and regulations.

UCPB personnel who will lose their jobs will be eligible for separation benefits, the order stated. They may also be hired by Landbank, subject to civil service requirements. John Ezekiel J. Hirro