So it was the first thing on some nosey observers’ minds when it was announced on Friday morning that well respected audit professional Protacio “Cocoy” Tacandong resigned from the board of Philippine National Bank after being named to it only four months ago.
What, on the surface, looked even more ominous was the fact that the co-founder of the much admired Reyes Tacandong & Co. (RT & Co.) audit and advisory firm was the head of PNB board’s audit committee (naturally).
Did he suddenly find something in the course of the last four months that he found unpalatable? Did he come into conflict with the bank’s owners because of it? Did he resign in protest? Was he made to resign?
Well, PNB stockholders and client will be glad to know that none of these is the case.
InsiderPH did some snooping around and found that Tacandong’s departure was prompted by an observation made by no less than the Bangko Sentral ng Pilipinas in the course of their regulation of PNB.
Apparently, Tacandong is in the habit of recusing himself from board-level decisions when discussions involve PNB borrowers who are also audit and advisory clients of RT & Co.
Unfortunately for the bank, many of their borrowers are also part of the growing roster of RT & Co. clients, which meant Tacandong was voluntarily recusing himself from more and more important discussions about the bank’s clients.
This practice spoke very well of his integrity, but unfortunately deprived the bank of his insight and expertise, especially concerning some it its biggest corporate borrowers.
At the same time, RT & Co. is now the official auditor of about 20 other banks, which places the firm’s co-founder in an even tighter conflict of interest situation.
All these things can, of course, be classified as “good problems to have”.
So the BSP told PNB: well, maybe you need to solve this because you need a board member who will be able to tackle more of these pressing issues.
As a result, Tacandong told the board that he would resign to save them the trouble. The board approved, and we hear the conglomerate’s chief, Lucio Tan III asked him instead to serve on the board of the parent holding firm LT Group… to which Tacandong graciously replied: We’ll see.
Indeed, we shall.
Senior Reporter
