The Overseas Filipino Worker (OFW) bank is set to open in Saudi Arabia to cater to the OFWs’ needs.
The bank will be opened by the third quarter of next year, with an authorized capital of P3 billion, the Department of Finance (DOF) said Tuesday.
While the requirements and procedures to establish the OFW Bank are still being completed, the state-owned Land Bank of the Philippines will set up by September a representative office in Saudi Arabia to cater to the banking needs of some 800,000 Filipino workers based in the Middle Eastern country, Finance Secretary Carlos Dominguez III said.
He said the OFW Bank will be established through the LandBank’s acquisition of the Philippine Postal Savings Bank, which will be converted into a LandBank subsidiary that will be owned 30 percent by OFWs. “The acquisition of the Postal Bank will be completed by the third quarter of 2017, after all required procedures are completed and approvals are secured. The LandBank has sufficient resources to complete this transaction,” said Dominguez, who chairs the LandBank board of directors.
As of September 30 this year, the LandBank ranked as the country’s 4th largest commercial bank with a total capital of P90.9 billion and assets amounting to P1.3 trillion. A bank dedicated to the needs of OFWs is one of the promises of President Rodrigo Duterte to Filipino migrant workers. LandBank president Alex Buenaventura said it would take eight months to accomplish the requirements that would convert the Postal Bank into a LandBank subsidiary.
“The OFW bank will be a listed company with an authorized capital of P3 billion and a subscribed capital of P2 billion, of which P1 billion is paid-up by the LandBank. Another P1 billion will be open for subscription to OFWs who can acquire them by buying shares in the bank,” Buenaventura said.
The LandBank will have to seek clearances from the Governance Commission for Government Owned and Controlled Corporations (GCG) and the Philippine Competition Commission (PCC), as well as approvals from the Monetary Board, Securities and Exchange Commission (SEC) and the Bangko Sentral ng Pilipinas (BSP) for the OFW bank to be operational by September 1, 2017.
