• Faith shines brightest in the dark

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    The year 2013 will be remembered as perhaps one of the most disaster-prone 12 months we’ve had in recent memory. It was totally mind-boggling: jewelry shop robberies inside shopping malls, the bus-from-the-Skyway disaster, the Zamboanga siege, the Bohol/Cebu earthquake, and the onslaught of Super Typhoon Yolanda.

    It was as if all cases of bad luck imaginable had been wrapped up in a nefarious little package, and were just viciously unleashed to an unsuspecting public.

    Yes, it’s very hard and very painful to find a silver lining from all of these. But yet, we must not stop trying. Even amid all these disasters, there are bits of positive developments that have transpired and even hard lessons that can be culled from the not-so-positive occurrences. For the rural banking industry, for instance, there are some defining moments that rural banks can use as a springboard moving forward.

    The Strengthening Program for Rural Banks (SPRB) Plus, a joint undertaking of the Bangko Sentral ng Pilipinas (BSP) and the Philippine Deposit Insurance Corp.
    (PDIC), is expected to improve the delivery of financial services in the countryside as it encourage mergers and consolidations (M&As) among rural banks, thereby fostering a stronger rural banking system. Strategic third-party investor (STPI) rural banks intending to acquire eligible rural banks through M&As can avail of financial assistance from the PDIC and regulatory relief from the BSP.

    In addition, the full effects of Republic Act 10574, or “An Act Allowing the Infusion of Foreign Equity in the Capital of Rural Banks, Amending RA 7353, otherwise known as the Rural Bank Act of 1992 as amended and For Other Purposes,” will soon be felt as foreign investors come in and infuse much-needed capital to local rural banks.

    RA 10575 allows non-Filipino investors to own, acquire or purchase up to 60 percent of voting stocks in rural banks, provided that the percentage of foreign-owned stocks will be determined by the citizenship of the individual or corporate stockholders of the bank.

    This law will further boost countryside development through investment in rural banks. It will also serve as a key instrument for the government to achieve its goal of full financial inclusion.

    The recent calamities have likewise prompted the BSP to issue regulatory reliefs to banks in Luzon, the Visayas and Mindanao. Even additional special measures were granted for those affected by Yolanda.

    Finally, all these catastrophes have put to fore the extreme importance of financial inclusion and why it must be the utmost priority of the country right now, with rural banks at the forefront. The domino effect of providing financial empowerment to the poor will result in a much stronger economy that can provide better resistance to foreign and domestic shocks. A community with access to financial services can protect itself even during contingencies. Rural banks have long espoused the concept of microinsurance. Now is the time to push it even more. You cannot be too safe to ignore or neglect the basic premise of insurance. After all, that we have experienced, being “safe” has become very coveted for all of us.

    Let us all just hope and pray that the Year of the Horse (2014) will be much, much better than 2013. Things have bottomed out. We will all rise again, together.

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