PNB sees remittance business growing by double-digits this year

MANILA, Philippines - Philippine National Bank (PNB) expects its remittance business to grow by double digits this year, besting the estimated seven-percent growth rate for the entire industry.

Total remittances coursed through the country’s banking system amounted to $18.76 billion in 2010, or 8.2 percent higher than the $17.34 billion recorded in the previous year.

PNB senior vice president and region head for Asia and Middle East Cesar C. Santos said the Lucio Tan-owned bank accounted for 15-to 18-percent share of the total remittance volume last year, amounting to about $3.3 billion.

“We have always done better than industry,” he said.

For 2012, the PNB official said uncertain conditions in economies overseas, especially the developed ones, could affect remittance inflows.

But nonetheless, Santos expects PNB to do better in 2012 in the remittance business. “We could land third overall among the top commercial banks,” he added.

The top five commercial banks in the remittance business are Banco de Oro Unibank Inc. (BDO), Bank of the Philippine Islands (BPI), Metropolitan Bank & Trust Co. (Metrobank), Rizal Commercial Banking Corp. (RCBC) and PNB.

PNB’s remittance business is strongest in the Asian market, comprising 27 percent of its total business. The North America and Canada market was the second biggest market, at a 25-percent share, followed by Europe and the Middle East markets.

The Japan market has been exceptionally strong as the yen has been gaining strength and the labor and services market for overseas workers remain buyout. “The Japanese population is an aging one, and the need for skilled yet cheap foreign labor remains strong despite some regulatory changes,” Santos explained.

Likewise, the market for overseas workers in Singapore and South Korea continues to show stability.

PNB has the biggest overseas branch network among the local banks, with over a hundred branches and subsidiaries.

It likewise has hundreds of correspondence bank relations, as well as tie-ups with international and domestic money transfer companies, agents, and consolidators/forwarding firms.

For the last mile network, PNB has its domestic branch network, banks and other financial institutions linked with PhilPASS, BancNet, couriers, domestic forwarders, and other non-bank financial institutions.

“Overseas workers can make direct transfers to their beneficiaries in the domestic branches online,” Santos added.

The top 10 country sources of remittances include the US, Canada, Saudi Arabia, the UK, Japan, United Arab Emirates, Singapore, Italy, Germany and Norway. The remittance flows from these countries amounted to $12.5 billion, which represented 84.9 percent of total remittances reported by banks.