The central bank said it is evaluating applications from three foreign banks that are seeking entry into the liberalized Philippine banking industry.
Bangko Sentral ng Pilipinas (BSP) Deputy Governor Nestor Espenilla Jr. did not identify the banks when he replied to questions about the developments in the entry of foreign players in the recently liberalized Philippine banking industry.
“Three applications filed that are under evaluation. The third filed a few weeks ago,” he said in a text message to reporters on Monday.
The local banking industry started attracting foreign players after the country passed Republic Act (RA) 10641, or the Act Allowing the Full Entry of Foreign Banks in the Philippines, in July 2014.
The act allows foreign banks to acquire up to 100 percent of the voting stock of an existing domestic bank, after it removed the previous 60 percent limit on foreign equity.
Foreign banks may now apply to operate in the Philippines either as a branch or as a wholly owned subsidiary.
The BSP’s Monetary Board will consider strategic relationships and reciprocity rights in accepting the applications of foreign bank entrants.
Besides BSP’s overall assessment, a separate assessment by the regulators in the banks’ respective countries of origin will also be required of the foreign bank applicants.
At present, six foreign banks have been given the green light to set up a branch in the country: Japanese lender Sumitomo Mitsui Banking Corp.; South Korea’s Shinhan Bank; Taiwan’s Cathay United Bank; Industrial Bank of Korea; Yuanta Commercial Bank Co.; and Singapore-based United Overseas Bank.