MANILA - President Rodrigo Duterte has approved the Land Bank of the Philippines’ acquisition of Philippine Postal Savings Bank, which will be spun off into a lender for overseas Filipino workers.

President Duterte approves Land Bank of the Philippines’ acquisition of Philippine Postal Savings Bank @ABSCBNNews pic.twitter.com/uika1Yjzst

— Dharel Placido (@dgplacido) October 9, 2017

The new entity will be named Overseas Filipino Bank, according to Executive Order 44, which was signed on Sept. 28 and released by Malacanang on Monday.

Philippine Postal Corporation, which owns Postbank, and the Bureau of Treasury were directed under the EO to transfer their Postbank shares to Land Bank at zero value.

Land Bank was ordered to infuse capital to Overseas Filipino Bank. Land Bank's chairperson will serve as head of the 9-member board of directors of the new lender.

The EO also called for an early retirement incentive plan for all Postbank officers who will be affected by the acquisition.

The thrift bank's total assets stood at P9.29 billion as of June this year, according to central bank data.

The proposal to absorb the operations of Postbank came after an oversight body on government coporations abandoned a plan by the previous administration to merge the Land Bank with another state-run lender, the Development Bank of the Philippines.