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MANILA, Philippines - Bank regulators have revised a program aimed at encouraging weak rural banks to take on new investors by expanding the list of potential white knights.
Under the revised Special Program for Rural Banks (SPRB), the list of potential white knights has been expanded to include "well-managed thrift banks and commercial banks as among eligible strategic third-party investors."
This should “encourage faster consolidation in the banking industry especially of small sub-scale banks," the Bangko Sentral ng Pilipinas (BSP) said in a statement.
The program offers incentives to interested third-party investors.
BSP and state-run Philippine Deposit Insurance Corp. (PDIC) each put in P5 billion to jumpstart the program.
PDIC grants financial assistance to augment the capital of weak banks, while the BSP provides regulatory relief as well as branch licenses for bank rescuers.
Bank regulators said 31 rural lenders are in need of a capital boost.
The program so far has attracted 17 white knights, with the PDIC approving four applications.
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