Financial Services
From The Report: Philippines 2021
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The Philippines’ financial services sector entered the Covid-19 pandemic on a solid footing, thanks to decades of regulatory reform to address the vulnerabilities exposed by the 1997-98 Asian financial crisis. Strong capital buffers, high levels of provisioning and near-universal public health cover insulated the country from many of the impacts that other markets continue to wrestle with. While geographic spread and socio-economic disparities remain structural barriers, increasingly tech-focused growth strategies are improving both bottom lines and financial inclusion among the population in measurable ways. The country has experienced a boom in digital banking as a result of the Covid-19 pandemic, with several digital-only banks announcing plans to enter the market, legacy banks rapidly upgrading their online offerings and the central bank eyeing ambitious digital banking targets. This chapter contains interviews with Benjamin E Diokno, Governor, Bangko Sentral ng Pilipinas; Kelvin Ang, CEO, AIA Philam Life; and Sanjiv Vohra, President and CEO, Security Bank.

Articles from this Chapter

Overview

Turning point: Advances in digital financial services are lowering the barriers to entry and increasing inclusion
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The Philippines’ financial services sector entered the Covid-19 pandemic on a solid footing, thanks to decades of regulatory reform to address the vulnerabilities exposed by the 1997-98 Asian financial crisis. Strong capital buffers, high levels of provisioning and near-universal public health cover insulated the country from many of the impacts that other markets continue to wrestle with. While geographic spread and socio-economic disparities remain structural barriers, increasingly tech-focused…

Interview

Staying on course: Benjamin E Diokno, Governor, Bangko Sentral ng Pilipinas (BSP), on guiding the economy through a global crisis
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Interview:Benjamin E Diokno What is your assessment of the BSP’s ability to mitigate the economic challenges brought about by the pandemic and facilitate recovery? BENJAMIN DIOKNO: With inflation well within the target range of 2-4% and the policy rate at 2.25%, the BSP continues to have ample room to utilise monetary tools to address the economic implications of the pandemic. Our latest estimate is that inflation will average 2.3% in 2020 and 2.8% in 2021. Moreover, our toolkit is far…

Analysis

Digital shift: Banks upgrade their online offerings in response to the pandemic
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The Philippines is experiencing a boom in digital banking as a result of the Covid-19 pandemic, with several digital-only banks announcing plans to enter the market and legacy banks rapidly upgrading their online offerings. East-West Banking Corporation, the country’s 11th-largest bank by assets, launched its own fully digital bank, Komo, in the third quarter of 2020. Furthermore, the state-owned Overseas Filipino Bank (OFB)became fully operational as a digital bank in June 2020.…

Analysis

Closing the gap: Private players look to micro-insurance, insurance technology and digitalisation to boost revenue and expand coverage
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While the pandemic has placed extra strain on the Philippines’ health care system, increased awareness of health risks could lead to a spike in private insurance coverage. With around 415,000 recorded cases and 8000 virus-related deaths as of mid-November, 2020, the Philippines has been one of the hardest-hit countries in South-east Asia–despite the implementationof stringent lockdowns. The spread of the virus has not only placed pressure on hospitals, clinics and staff…

Interview

Coverage and flexibility: Kelvin Ang, CEO, AIA Philam Life, on essential steps to increase insurance penetration rates
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Interview: Kelvin Ang How would you assess the pace of digital transformation in the Philippines’ insurance sector? KELVIN ANG: Several factors are shaping the digital transformation of the insurance industry, including the maturity of the economy and the sector itself; customer sophistication; and evolving regulations. Most companies in the market are focused on embracing digital tools and technology, and adopting these to increase efficiency, especially in terms of service delivery. While the…

Interview

Financing recovery: Sanjiv Vohra, President and CEO, Security Bank, on the strength of the banking system in a time of crisis
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Interview: Sanjiv Vohra Which factors help banks alleviate the economic implications of the pandemic? SANJIV VOHRA: Banks have the necessary liquidity, capital and reserve ratios mandated by the central bank, Bangko Sentral ng Pilipinas (BSP), to provide finance to businesses throughout the economy. Importantly, the financial system is more resilient and reacted quicker to Covid-19 than to previous crises: during the Asian financial crisis of 1997-98, for example, the adequacy ratios of banks were…