By Macon Ramos Araneta

THE lawyer of taipan Lucio Tan said the government has no basis to stop the merger of the Philippine National Bank with Allied Banking Corp. because the state has not proven the billionaire?s shares in the latter were ill-gotten and they are entitled to it.

In yesterday?s hearing for the government?s petition for a temporary restraining order and preliminary injunction, lawyer Estelito Mendoza told the Sandiganbayan Fifth Division the state failed to show there is a clear and unmistakable right to be protected.

?This is the basic requirement for the issuance of an injunction. It must show clearly, unmistakably that it is entitled to such right,? Mendoza said.

He admitted to the merger of the banks, both owned by Tan, but emphasized this was not yet final as the Securities and Exchange Commission and central bank have not yet given their approval.

Presidential Commission on Good Government special counsel Catalino Generillo Jr. said Allied Bank will be absorbed by PNB.

?There will be no more shares of stocks in Allied Bank to be ran after in this case,? Generillo also said.

Mendoza said that while the government is preserving assets it is also subverting the value of these assets by sequestering and dragging its feet on their prosecution.

He also told reporters that not all shares of stocks in Allied Bank are owned by Tan.

?The plaintiff [Republic of the Philippines] also failed to show that the shares of stocks in Allied Bank came from the funds of the government, and owned by the government,? he said.

Mendoza also filed his opposition to the preliminary injunction, saying the merger would not be prejudicial but beneficial to the shareholders of Allied Bank.

?Bigness of the banks is the name of the game, for the strength and stability in financial institutions,? said Mendoza .

PNB and Allied Bank on a stand-alone basis rank only no. 5 and no. 11 among the country?s commercial banks. Upon merger, the merged banks will rank no. 4 among Philippine banks.