Philippines plans to create bank for overseas workers

The Philippines is set to create a new bank catering to the needs of overseas Filipino workers (OFWs).

The Overseas Filipino Bank is set to have an authorised capital of one billion pesos and will specifically target OFW remittances, while offering allied services to them.

The Middle East accounts for an estimated 12 per cent of a total $8 billion sent by the eight million Filipinos abroad.

Congressman Prospero Nograles and Jaime C. Lopez, chairman of the House Committee on Bank and Financial Intermediaries, filed House Bill 1565 as an Act of Establishing the Overseas Filipino Bank.

The bill is set for first reading during the ongoing 13th Congress session.

"The bank will concentrate on addressing the banking, economic, financial and related needs of more than eight million Filipinos abroad whose estimated $8 billion goes to government reserves annually," said an official report.

"An estimated 12 per cent of the remittances are coming from Middle East, not counting informal channels," the report added.

Amroussi "Cheng" Rasul, vice-president of Philippine National Bank, Dubai, noted that five years ago, PNB offered a trust fund managed by its investment arm called 'Punla' (seed).

The fund grew by about 50 per cent last year to 600 million pesos from the previous year and has 7,000 investors, he said.

Analysts emphasised that in creating such a bank the government could maximise the benefits coming from OFW remittances.

According to the proposed bill, half the capital will be paid by the government while the remaining will be open to OFWs and their beneficiaries.

The bank will be fully supervised and regulated by the Bangko Sentral ng Pilipinas, the Philippines central monetary authority.