Eight Asian banks eyeing PHL presence

EIGHT MORE Asian banks are looking to enter the Philippines, a senior central bank official said, signalling growing interest and confidence towards the local banking system.

BSP Deputy Governor Nestor A. Espenilla, Jr. said there are eight new foreign players looking to set up shop in the country.

“There are a couple more in the pipeline… There are definite new players coming in. Those are the active inquiries that we have, around eight,” the incoming central bank chief told reporters on the sidelines of a business luncheon yesterday in Makati City.

Last January, BSP Governor Amando M. Tetangco, Jr. said six new lenders are looking to enter the Philippine market.

Nine offshore lenders have secured the BSP’s approval to set up branches in the Philippines over the last two years, following the passage of Republic Act (RA) 10641 that lifted the limit on the number of foreign players that can operate in the country.

The law states that more foreign banks • which should be publicly listed in their home country • can come to the Philippines by acquiring, purchasing or owning up to 100% of the voting stock of an existing bank.

New players can also invest in up to 100% of the voting stock of a new banking subsidiary incorporated under Philippine laws, while a third mode of entry would be through establishing branches with full banking authority.

TAIWANESE BANK

Mr. Espenilla added that one new Taiwanese bank will “inaugurate” their operations in Manila soon.

Four Taiwanese banks have secured licenses to set up shop in the Philippines from the BSP: the Cathay United Bank, Yuanta Commercial Bank Co. Ltd., First Commercial Bank, and Hua Nan Commercial Bank Ltd., which got the central bank’s approval in September last year.

Completing the list of new foreign banks that entered the country under RA 10641 are South Korea’s Industrial Bank of Korea, Shinhan Bank, and Woori Bank; Japan’s Sumitomo Mitsui Banking Corp.; and Singapore’s United Overseas Bank Ltd.

Mr. Espenilla earlier said that he expects more international banks to venture into the Philippines as the firms see the huge consumer market, the robust economic growth, and the government’s infrastructure push as opportunities to expand their loan portfolios.

In April, the BSP completed its negotiations for a cross- border agreement with Bank Negara Malaysia, which would allow three banks from one country to set up its business in the other under the Banking Integration Framework of the Association of Southeast Asian Nations eyed in full swing by 2020. Bilateral discussions with the Bank of Thailand have also been started last month.

Separately, Mr. Espenilla said a non-Asian bank is also in search of a strategic Philippine partner as it looks to enter the local market.