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ICBC eyes investments in RP

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By Joel Guinto
INQUIRER.net
First Posted 15:32:00 10/28/2008

MANILA, Philippines – (UPDATE) The Industrial Commercial Bank of China (ICBC), mainland China’s largest of the “Big Four” state-owned commercial banks, is keen on investing in the Philippines.

Talks are underway between the ICBC and the GSIS Family Bank, a wholly-owned subsidiary of the state pension fund, the Government Service Insurance System (GSIS), Finance Secretary Margarito Teves told a news conference in Malacañang.

“Hopefully, there will be an early completion of this discussion between the ICBC and the local counterpart here, the GSIS Family Bank (GFB),” Teves said.

A GSIS statement said the formal offer to invest in GFB was made after recent discussions between GFB and ICBC officials in Manila and in Beijing.

In a letter to GFB president and GSIS board trustee Reynaldo Palmiery, ICBC deputy general manager Wang Wenbin indicated the bank’s interest to invest in GFB as a third party strategic investor.

ICBC is applying for a commercial license to operate and engage in expanded foreign currency deposit units, trust and quasi-banking functions.

ICBC plans to open an additional 20 GFB branches and relocate 12 GFB branches as it seeks authority to accept government deposits from the GSIS and local government units.

“We also require confirmation from the GSIS that GFB will continue to be the conduit for its investments and that the GSIS is prepared to divest to a minority position in GFB,” Wang said in his letter to GSIS.

Trade Secretary Peter Favila said ICBC’s interest was “clearly a vote of (China’s) confidence.”

Teves said ICBC’s interest “will serve as a magnet for other investors to come in. In a situation where there is a global financial crisis, the question that we normally ask is, why is a very big bank investing in the Philippines?”

“The investment of ICBC will not only provide the GFB with a very strong financial base, but also signify ICBC’s confidence in the Philippine banking and financial system, as well as the whole economy,” said GSIS president and general manager Winston F. Garcia.

ICBC is the largest bank in China and in the world in terms of market value. It is one of the world’s top 10 banks in terms of assets.

As of 2006, it had assets of US$893 billion, with over 18,000 outlets including 106 overseas branches and agents.

Meanwhile, the GSIS said it planned to unload its 42-percent stake in GFB. GSIS owns 99.55 percent of GFB, consisting of two billion common shares and 500 million preferred shares.

GSIS Family Bank comprises several banks, including Royal Savings Bank and Com-Savings Bank. It has 22 branches, concentrated mostly in the Cavite-Laguna-Rizal area, otherwise known as the CALABAR zone.

View article as posted on INQUIRER.net

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Written by joelguinto

TueUTC2008-10-28T07:58:28+00:00UTC10bUTCTue, 28 Oct 2008 07:58:28 +0000 22, 2006 at 12:45 am10

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