Following the issuance of Executive Order No. 179 by President Benigno Aquino III ordering the inventory, transfer, reconveyance, and disposition of coco levy assets, and the transfer of the proceeds for the use and exclusive benefit of coconut farmers and the development of the coconut industry, the recapitalization of United Coconut Planters Bank (UCPB) through privatization by way of public bidding has been approved by the Privatization Council with bidding date set for September 2015.

The bank's ability to raise capital has been deterred by the pendency of the case on the ownership of the bank. The recapitalization of the bank is now possible with the ownership of the bank having been finally decided by the Supreme Court in 2013 i.e., that the government owns the shares funded by coco levy funds.

PDIC President Cristina Orbeta said that the recapitalization is an integral part of the 10-year rehabilitation plan agreed to with PDIC, the Bangko Sentral ng Pilipinas, Department of Finance and the Presidential Commission on Good Government in 2008. She said that while the bank's financial position has continued to improve, even outperforming the targets under the plan, its growth potential has been tempered due to lack of capital. The recapitalization will further boost UCPB's competitiveness and sustain its viability. At the same time, the size and franchise value of the bank makes it a strategic acquisition by domestic and foreign investors.

A public bidding for the right to recapitalize, and purchase the government's interest in, the bank is set sometime in September 2015. The Privatization and Management Office has been designated as the disposition entity, and shall soon request for submissions of expression of interest from prospective investors. The auction will be open to eligible domestic and foreign entities with proven track record in banking.

Finance Secretary Cesar V. Purisima said, "Recapitalizing UCPB is a big step forward in implementing EO 179 as part of the President's leadership on this longstanding issue. UCPB's successful recapitalization is integral in protecting the bank's depositors and in strengthening our financial system. More importantly, it also enables the government to get the best value for the coconut fund set aside for our coconut farmers."

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