BSP allows foreign banks to put up 5 sub-branches

The Bangko Sentral ng Pilipinas (BSP) has allowed foreign banks setting up shop in the Philippines to establish five branchlite units or sub-branches nationwide.

BSP Governor Nestor Espenilla has issued Circular No. 987 on the rationalization of prudential requirements on banking offices and guidelines on the establishment of branch-lite units.

A branch-lite unit shall refer to any permanent office or place of business of a bank, other than its head office or a branch. A branch-lite unit performs limited banking activities.

The BSP’s Monetary Board has so far approved the entry of 11 foreign banks since Republic Act No. 10641 - an act that allows the entry of foreign banks into the Philippines through the establishment of wholly-owned operations with full banking authority – was signed by former president Benigno Aquino III in July 2014.

Foreign banks that were given the green light to establish branches in the Philippines include Korea’s Shinhan Bank, the industrial Bank of Korea, and Woori Bank; Taiwan’s Hua Nan Commercial Bank Ltd., Cathay United Bank, Yuanta Bank, First Commercial Bank, and Chang Hwa Bank Commercial Bank Ltd.; Sumitomo Mitsui of Japan; United Overseas Bank Ltd. of Singapore; and Malaysia’s CIMB Bank Berhad.

A total of six more foreign banks – two from Taiwan, two from China, one from Indonesia, and one from South Korea – are looking at establishing banking operations in the country.