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Philippine banks' preparedness for Asean integration doubted
Publication Date : 27-05-2014
Is the Philippine banking industry ready for the Asean [Association of Southeast Nations] integration in 2015? Nestor Tan, president of the country's biggest bank, Banco de Oro (BDO), seems to be in doubt.
“From the banking perspective, my comments are borne out of several issues: one is market. The Philippines is very attractive for our Asean partners so it’s clearly one of the markets they’d likely to expand into,” he said at a Congress inquiry on Tuesday. But he said the banking industry here might not be (big) enough to compete with bigger players.
“I don’t know if this is appropriate, it’s like establishing PBA and NBA,” Tan said.
“Yes you can establish reciprocity but clearly the [NBA] players are bigger and better than the players here so they will be able to play better,” he said.
Banco de Oro will rank 19th in the region once the 10-nation Asean integrates into a single market in 2015.
“If you combine the top three: BPI, BDO and Metrobank, we’re only as big as Bangkok Bank and that is number 7. That’s how small we are,” Tan said.
“What do we want to do with our banking industry? Our industry is a bug taxpayer…Are we going to let the others come in…are we going to shift our policy to encourage bigger banks here?”
The House committee meeting on Tuesday was aimed at looking into the country’s preparedness to the Asean integration. A briefing was made by the Department of Foreign Affairs and the Department of Trade and Industry before congressmen and representatives of public and private sectors.
The Asean economic community aims to transform the region into a single market and production force; highly competitive economic region; a region of equitable economic development and a region fully integrated into the global economy by 2015.
Asean has a base of 608 million individuals in 10 countries.