CIMB Bank looks to set up PHL branch
By Melissa Luz T. Lopez, Senior Reporter
MALAYSIA’S CIMB Bank has formally applied to set up a branch in the Philippines, adding to 10 foreign players that have set their sights on Manila and completing its regional expansion, a central bank official said.
The Kuala Lumpur-based CIMB Group Holdings Berhad has submitted documents to the Bangko Sentral ng Pilipinas (BSP) to operate a bank branch in the country, which is now being evaluated and could secure the regulator’s approval “within the year,” the official added.
CIMB is the second-largest bank in Malaysia. It has long been eyeing to venture into the Philippine market as it previously tried to acquire a controlling stake in San Miguel Corp.’s Bank of Commerce back in 2012. It has previously been reported that CIMB may have also explored talks with businessman Alfredo M. Yao’s Philippine Business Bank, as well as with the Philippine Bank of Communications.
In 2015, CIMB gained access to the Philippine market through a “strategic collaboration agreement” with PLDT Inc. in offering digital financial services.
CIMB Group chief executive Tengku Datuk Seri Zafrul Aziz has earlier been quoted by Malaysian media as saying that the lender is looking to start banking operations in the Philippines as early as the third quarter of 2017, in line with plans to broaden their presence across Southeast Asia.
CIMB operates in 15 international markets including nine of the 10 Association of Southeast Asian Nations (ASEAN) economies, according to the bank’s Web site. Securing the BSP’s approval will complete the lender’s footprint in the region.
The BSP completed its bilateral negotiations with the Bank Negara Malaysia under the regional banking integration framework for ASEAN member-states. Signed in April, the deal allows three qualified banks from one country to operate in the other, subject to the regulations set by the host economy.
Maybank is the sole Malaysian bank operating in the Philippines so far, which has secured a license to operate years ahead of these negotiations.
Cross-border banking deals build on Republic Act 10641 signed in 2014, which allowed the full entry of foreign banks in the Philippines.
Prior to this reform, only 10 foreign banks can operate in the country at a given time, with a new foreign bank only able to enter the local scene if one of the accredited offshore lenders pulls out.
Five of the new foreign banks which have entered the country are from Taiwan: Cathay United Bank, Yuanta Commercial Bank Co. Ltd., First Commercial Bank, Hua Nan Commercial Bank Ltd., and the Chang Hwa Commercial Bank, Ltd.
Other banks which have launched operations here over the last two years are the Japan-based Sumitomo Mitsui Banking Corp.; South Korea’s Industrial Bank of Korea, Shinhan Bank, and Woori Bank; and the Singapore-based United Overseas Bank Ltd.
