MANILA, Philippines — The decision of American banking giant Citigroup Inc. to exit the Philippine retail banking segment presents an opportunity to other major players in the industry.
Cezar Consing, outgoing president and chief executive officer of Ayala-led Bank of the Philippine Islands, said Citi has a “terrific” retail and consumer business in the country where it has been operating for over 100 years.
“It is a well-managed business with a significant customer base. Citi’s rationalization plans in the Philippines could represent growth opportunities for other market participants,” Consing said.
Citi announced last week it is exiting the retail banking segment in the Philippines and 12 other markets in Asia, as well as Europe, Middle East and Africa, in order to focus its global consumer bank presence in Singapore, Hong Kong, United Arab Emirates and London.
However, Citi Philippine CEO and country officer Aftab Ahmed said the strategic action in global consumer banking would have no immediate change in the bank’s operations in the country.
“There is no immediate change to our operations, and no immediate impact to our colleagues as a result of this announcement. In the interim, we will continue to serve our clients with the same care, empathy and dedication as we do today,” Ahmed said.
Citi Philippines bank 90 percent of the top 20 largest market cap firms and over 950 multi-national companies in the Philippines. It is keeping its wholesale banking operations as its Institutional Clients Group is a recognized leader in arranging and providing financial services for the public sector, top-tier Filipino corporates, multinationals, and financial institutions operating in the country.
Union Bank of the Philippines president and CEO Edwin Bautista said Citi’s strategy makes sense for its overall global business
Antonio Moncupa, president and CEO of Gotianun-led East West Banking Corp., said as a result of the new development either an incumbent gets to strengthen current position or a new player takes the opportunity for a grand entry into the business.
“This kind of thing is always fluid. Is EasWest interested? It is never wise to be definite without the necessary bases to make a judgment. But let me say this, every serious player in the retail banking game, and EastWest is, will at least pause and consider the strategic meaning of the opportunity,” Moncupa said.
This early, the industry considers BDO Unibank Inc. as a frontrunner in the contest.
Aside from taking over Citi Savings Bank in 2014, the country’s largest lender also purchased Citibank Tower along Paseo de Roxas as the American banking giant transferred to BGC.