EIB bidding fails anew

MANILA, Philippines - The public sale of Export and Industry Bank (EIB) resulted in another failure yesterday, prompting government to consider rehabilitation or liquidation for the closed bank.

The Philippine Deposit Insurance Corp.  (PDIC) held a re-bidding yesterday of EIB. However, no bids were received either through a letter of interest or pre-bid documentary.

“Under Section XI of the terms and conditions for the re-bidding and re-bidding procedures on the rehabilitation of the closed EIB, non-receipt of letter of interest or pre-bid documentary requirements is a ground for the declaration of failure of bidding,” the PDIC said in a statement.

PDIC general counsel and chairperson of the bidding committee Romeo M. Mendoza Jr. said under these circumstances, the submission of bids scheduled on March 20, 2013 can no longer push through.

Last week, the PDIC announced that it will re-bid EIB’s rehabilitation via purchase of assets and assumption of liabilities.

“The PDIC vigorously exerted efforts to facilitate the rehabilitation of EIB in order to help maximize the potential recovery of the closed bank’s depositors and creditors. With this development, the task at hand is for PDIC to make a final determination on whether EIB may be rehabilitated, then submit its report to the Monetary Board,” Mendoza said.

BDO Unibank Inc., the first institution to court EIB, said that it had lost interest in acquiring the bank.

“We confirm that BDO Unibank Inc. does not intend to submit the requirements of the Philippine Deposit Insurance Corp. for its rebidding for the rehabilitation of the Export & Industry Bank,” the SM affiliated commercial bank said in a disclosure to the Philippine Stock Exchange (PSE).

BDO had been “courting” EIB prior to being placed under receivership last year.

EIB has P12 billion in assets -- including 50 branches – but its liabilities are estimated at P24 billion.

The PDIC did not announce the floor price for EIB since it started “marketing” the bank. Incidentally, the sale of the bank’s assets and liabilities is separate from the sale of the commercial bank license.