DOF: OFWs will have own bank in October

By By Rea Cu

A bank designed specifically to service the needs of overseas Filipino workers (OFWs) is seen operating in October with the conversion of the Postal Bank into an OFW bank, according to the Department of Finance (DOF).

“Yes, the target is early October,” Finance Secretary Carlos G. Dominguez III told financial this month , adding that the Land Bank of the Philippines (LandBank) is currently doing the valuation process to facilitate Postal Bank’s conversion.

Last year the Duterte administration announced its plan to turn  Postal Bank into a bank that will cater mainly to the needs of Filipino workers abroad. The plan was to offer 30 percent of the bank’s ownership to OFWs.

An authorized capital of P3 billion was estimated for the bank to be able to serve the banking needs of millions of OFWs.

“We have already on board the valuation for Postal Bank, so the next step is to go to the regulators for the approval of the process, and also to the board on the valuation. Following that, we are going to approach the Postal Bank Corp. and negotiate on the price,” National Treasurer Rosalia V. de Leon said.

The DOF said LandBank will initially set up a representative office in Saudi Arabia to cater to the banking needs of some 800,000 Filipino workers based in that country.

LandBank President Alex V. Buenaventura said it will take eight months to accomplish the requirements that would convert Postal Bank into a LandBank subsidiary.

LandBank will have to seek clearances from the Governance Commission for Government-owned and -Controlled Corporations and the Philippine Competition Commission, as well as approvals from the Monetary Board, Securities and Exchange Commission, and the Bangko Sentral ng Pilipinas.

“Based on the valuation made by LandBank, it showed a negative value of P580 million…that’s their valuation of the bank. I mean, this bank has been struggling for many years, but you know that is an internal negotiation between two government agencies, so we will settle it among ourselves. It’s not like we are bidding it out with the private sector; it’s the same pocket in the end, it’s the Treasury pocket in the end,” Dominguez added.

Article attribution

Article appeared in Business Mirror

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