LOCAL banking giant Bank of the Philippine Islands (BPI) is not keen on setting up shop outside the archipelago just yet, as the lender said it would rather focus on improving the efficiency of domestic operations.
In a recent dialogue with the BusinessMirror, BPI Executive Vice President and Corporate Banking Head Juan Carlos L. Syquia said BPI would rather focus onshore as growth prospects in the Philippines remain “solid.” Syquia added there is a lot to be done in their local banking operations that would need their full focus of resources and manpower.
In recent years, several foreign banks have entered the local banking sector because of two developments: the Philippines’s liberalization of foreign bank policies and the ongoing developments toward banking integration in the region.
Most of the foreign banks who entered local operations, as well as those who have expressed their desire to participate in the Philippine banking industry, are from Asian nations and will be under the banking integration program.
Local banks, meanwhile, have not been keen on setting up operations abroad despite their potential market of servicing many overseas Filipino workers.
Syquia said that as of the moment, it is not efficient for a local bank to set up shop in neighboring jurisdictions due to the stringent regulatory requirements–particularly onshore capital needs, as banks will have to fulfill capital requirements both in their home country and abroad.
BPI is also looking at onshore funding sources to finance its operation and expansion plans.
In a separate statement last Tuesday, the bank said it is offering peso fixed-rate bonds in the aggregate principal amount of up to P3 billion, with an option to upsize.
“We are confident that investors will continue to support BPI’s fund raising initiatives, as backed by the Bank’s robust credit metrics,” BPI Treasurer Dino R. Gasmen said.
The bonds will have a tenor of two years and an interest rate of 4.2423 percent per annum, paid quarterly. The minimum investment amount us at P1 million in increments of P100,000, thereafter.
The offer period will be from January 13 to 17, 2020, and the issue and listing date will be on January 24.