By Arno Maierbrugger
Gulf Times Correspondent
Bangkok
Manila-headquartered BDO Unibank, the largest bank in the Philippines, has become the first Filipino bank to set up an office in the Gulf Cooperation Council (GCC) where it will operate within the premises of the UAE’s Dubai International Financial Center, a financial free zone and one of the largest financial hubs in the Middle East.
The establishment of a GCC office is a reaction to the growing number of Philippine expats in the region and their banking needs, Nestor Tan, president and CEO of BDO Unibank, explained. Filipinos form one of the largest expat communities in the GCC, with an estimated 700,000 of them living and working in the UAE. More than 1.2mn are said to stay in Saudi Arabia and over 200,000 in Qatar, and all are the source of significant money flows back to the Philippines.
“Setting up a representative office in the Dubai International Financial Center was driven by our objective to further widen our overseas network to provide support to Overseas Filipino Workers (OFWs) and residents,” Tan said, adding that “the expansion into Dubai will boost our capability to service the needs of our countrymen in the entire Middle East and, hopefully, make the bank a catalyst for the progress of financial inclusion of the expatriates in the Philippines.”
The new branch comes on top of several partnerships BDO Unibank already has in the Gulf. It struck a deal with Emirates NBD in January this year to provide quick money transfer services to the Philippines. It also cooperates with UAE Exchange, Al Ansari Exchange and Al Ghurair Exchange for remittance services, as well as with Gulf Exchange in Qatar and other banks and financial service providers in Saudi Arabia, Oman, Kuwait, Bahrain and Jordan.
OFWs are the third largest source for remittances globally, with $28bn sent back home in 2014, only being topped by Indians and Chinese who sent home the biggest chunk at $70bn and $64bn, respectively. With regards to Filipino remittances, estimates are that more than half of total remittances to the Philippines are originating from the GCC, making it a huge business for regional money remittance services.
The new branch in Dubai, however, aims at widening the scope of banking services on offer for Filipinos, Tan indicated, as well as at extending the reach of BDO Unibank’s portfolio within GCC countries as the bank also wants to address possible Philippine expat and Middle East investors and provide more sophisticated financial services than just remittances. The bank offers a variety of corporate, commercial and retail banking services, including traditional loan and deposit products. This is in addition to treasury, trust banking, private banking, wealth and cash management, leasing and finance, insurance, retail cash cards and credit card services.
BDO Unibank – its full name is Banco de Oro Universal Bank – was founded in 1968 as a small savings bank in Manila and became a universal bank only in 1996. Today, it has over 870 branches in the Philippines and one other foreign branch in Hong Kong. It is one of the many banks owned by Chinese-Filipino businessmen in the Philippines, namely tycoon Henry Sy – listed by Forbes Magazine as the richest man in the Philippines – through his conglomerate SM Group of Companies, one of the country’s largest business groups with activities spanning from retail, mall operations and property development to financial services.
Since 2001, the bank grew through remarkable mergers and acquisitions, among them the Philippine operations of Banco Santander, Citibank, UOB, Deutsche Bank and GE Money. In March 2008, it was listed on the Philippine Stock Exchange. Its main competitors on the home soil are Metrobank, owned by Chinese-Filipino business tycoon George Ty, and Bank of the Philippine Islands (BPI), the oldest bank in the Philippines and a subsidiary of Ayala Corp, the country’s largest business conglomerate majority-owned by the influential Ayala family, which is of Spanish descent.
