The Philippine National Bank (PNB) has recently expanded its remittance business in a bid to become the leading commercial bank in the remittance business.
It recently signed a remittance accord with Ehud Neor to serve as its first send-out agent in said country.
The partnership facilitates the establishment of remittance service centers in Israel, providing another alternative to oversaeas Filipinos who regularly remit dollars to the Philippines.
Beneficiaries of overseas Filipinos, on the other hand, will receive their money via credit to PNB account, other bank accounts, door to bank, door to door, and advice and pay anywhere system (APAS). Clients using APAS may claim their remittances through PNB domestic branches, or from any of the 3,500 payout agents spread out nationwide.
Recently, PNB merged its two wholly-owned subsidiary in Hong Kong, PNB International Finance Ltd. (PNB IFL) and the PNB Remittance Center Ltd. (PNB RCL) with PNB IFL as the surviving entity. It will thus be renamed PNB Global Remittance and Financial Co. (HK) Ltd.
PNB is a dominant player in the Philippine remittance business. Its international presence is reportedly among the most extensive among local banks with 104 offices in 14 locations across North America, Europe, Middle East, Asia and the Pacific.
PNB senior vice president for global marketing Patricia Tan expressed optimism that it would generate remittance-related businesses of between $2 to $2.5 billion in 2008.
In 2007, PNB accounted for $1.8 billion in remittance business.
The remittance target however does not include whatever Allied Banking Corp. (Allied Bank) in the same period. The two banks merged earlier this year, but the merger process will only be completed towards the end of 2009.
Tan is confident that the business will improve despite the global credit crisis.
“Some areas recorded lower than expected remittances but it was offset by other areas which recorded better than expected business,” the PNB official said.
But the anticipated downturn has prompted banks to make the necessary adjustments.
”We have been preparing for the poor environment by increasing channels like new or improved correspondent bank relationships, tie-ups with remittance companies, and other receiving or distribution outlets,” Tan said.
Remittances coming from overseas Filipinos in the United States this year is expected to weaken as it is the hardest hit by the credit crisis. But overseas Filipinos located in the Middle East and European markets are forecast to increase significantly.
There are at least 10 million recorded overseas Filipinos, who send back dollar-based remittances to beneficiaries in the Philippines. Assuming that it affects at least five individuals per overseas Filipino, it would mean roughly 50 million or more than half of the country’s nearly 90 million growing population. Thus it is not surprising that remittances are estimated to account for 10 percent of gross domestic product (GDP).
Ehud Neor, one of Israel’s leading companies in the money transfer business, will service the remittance needs of the Filipino community at its office in Nitzan and in Tel Aviv through its sub-agent, Hot Card.