NEWSFLASH

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ESTRADA GOVT TO FULLY PRIVATIZE PNB

Manila, May 27, 1998 - Full privatization of the Philippine National Bank will be realized under the Estrada administration within one year, during which period the remaining 45.59% PNB holdings of the national government will be unloaded.

PNB president Peter Favila, who has submitted a proposal for PNB privatization to the incoming government, told reporters that the bank's top officials have been coordinating with Estrada's designated Finance Secretary Edgardo Espiritu. Espiritu, former PNB president, led moves for the rehabilitation of the bank in 1986.

Privatization of the PNB has been agreed upon by both the present and the incoming administrations in order to build up the bank's capital.

Being mulled are the possible sale or merger with local or foreign financial institutions and the sale of convertible bonds or stock rights. Estrada's advisers are reportedly favoring the sale of subsidiaries such as Century Park and the PNB's International Finance Ltd., then selling off the whole remaining block of 45.59% by public bidding.

A full review of the PNB's true financial condition will be undertaken before Estrada's administration could work out its privatization plan.

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