Comes now Octavio Borlaza Peralta, a Filipino who has been leading development banking practitioners in pioneering highly creative programs that mobilize financing for development purposes in Asia and the Pacific regions. This, in his capacity as secretary-general of the Association of Development Financing Institutions in Asia and the Pacific (ADFIAP), a 30-year old international development NGO based in Makati City.
Peralta, "Bobby" to friends and colleagues, has been at the helm of ADFIAP since January 2005 when he took over from his long-time boss in the organization, Orlando Peña, who had retired. Previous to this, he had been ADFIAP deputy secretary-general for 13 years.
As secretary-general, Bobby leads a staff composed also of Filipinos that back-stops the work of the ADFIAP chair, another Filipino in the person of Jesus P. Tambunting, former Philippine ambassador to the United Kingdom and concurrent chairperson and chief executive officer of Planters Development Bank (Plantersbank), one of five Philippine member-development banks of ADFIAP.
Peralta and ADFIAP are in the business of development banking, defined as banking by "a national or regional financial institution designed to provide medium- and long-term capital for productive investment, often accompanied by technical assistance, in less-developed areas".
According to Peralta, there are three emerging "functional models" of development banking:
• the policy banking model, which provides directed finance through government-supported development banks whose capital are sourced from government, quasi-government and government-guaranteed funds, as can be found in Japan, China, Korea and Malaysia;
• the universal banking model, which provides long-term finance plus advisory services through investment and commercial banks whose capital is sourced from the international financial markets and from their own financial instrument offerings as can be found in Singapore, India, Sri Lanka, the Philippines, etc.; and
• the ‘niche’ banking model which provides development finance through "specialized" development banks that caters to specific sectors of the economy such as SMEs, housing, infrastructure, export-import, IT, etc. as can be found in Pakistan, Thailand, Indonesia, etc.
Are development banks in the business of making money? Peralta says that the concept of profit per se is different in the context of a development bank, as it also considers in its ‘bottom line’, at least three other critical issues, i.e., economic contribution, social equity and ecological considerations, aside from financial returns. In other words, profit maximization is not the overarching objective of a development bank, as compared to other financial institutions with private interests and stockholders that expect financial dividends. But having said these, a study of development banks in the Asia-Pacific region reveals that these institutions are financially-stable. And rightly so, as they have to be in order to be sustainable institutions and to undertake their developmental mission in earnest.
Describing ADFIAP and his work, Bobby, a licensed mechanical engineer who cut his teeth in development banking working first as a technical analyst and then as a trainor at the Development Bank of the Philippines, says "our work is mainly one of building relationships."
Looking into ADFIAP’s membership profile, it is easy to understand why. Being the focal point of all development banks and other financial institutions engaged in the financing of development in the Asia-Pacific region, ADFIAP has within its ranks development banks owned mostly by the governments of countries as far west as Samoa and Fiji in the Pacific and as far east as Turkey on the Asian mainland.
"Our members represent diverse cultures and the challenge was and still is maintaining unity amid such diversity," Peralta says. It is a challenge that he and his staff has been able to respond to rather effectively, helped in large part by what Peralta describes as the "great adaptability" of Filipinos.
"We adapt easily to different cultures," says Peralta. "This is not only because of our good communication skills but because of our credibility founded on our strong knowledge of development banking," he adds.
Peralta explains that maintaining credibility is an important part of his task in ADFIAP. In the first place, he works with bankers who consider the trust and confidence as the primary ingredients in the successful conduct of the business.
"Hindi nadadaan sa bola ang mga taong ito," (You can’t just win it with these people.), says the 54-year old native of Liliw, Laguna. "You have to back up your good relationship with them with concrete action to be able to convince them to join and remain with the organization," he adds.
Mainstreaming ADFIAP and building its membership base has been Peralta’s top action agenda. One of the first tasks that he helped accomplish in the way of establishing international recognition for ADFIAP has been to accredit it as a United Nations (UN) organization.
ADFIAP today is an NGO in consultative status with the United Nations’ Economic and Social Council. Peralta himself is co-chair of the Asia-Pacific Task Force outreach group of the United Nations Environmental Programme Finance Initiative, a status that has increased ADFIAP’s standing in the World Federation of Development Financing Institutions composed of regional associations in Africa, Asia-Pacific, Latin America and the Middle East.
Such linkages, Peralta points out, has helped a lot in increasing ADFIAP’s membership – from 52 in 25 countries when he took over as secretary general in 2005 to 74 members in 35 countries at present – and in promoting and causing the adoption of the values and practices of sustainable development, environmentalism and social banking among Asian and Pacific development financing institutions.
Peralta attributes the increase in ADFIAP’s membership to the fact that members now see greater value in being part of the ADFIAP network, particularly in terms of the vital stock knowledge in development banking that the network represents. ADFIAP members are able to access this knowledge through the different trainings that the Association regularly provides to bank officers and staff particularly in the areas of green banking or environmental governance in development banking, social banking and the financing of small and medium enterprises (SMEs).
"We have also been able to stimulate membership by being more transparent and more strict in our governance compliances and also, by pushing members, particularly members of the ADFIAP Board, to become more involved in Association activities," Peralta says.
Peralta’s personal objectives as secretary-general, which he calls Vision One, is to increase ADFIAP’s membership to 100 from the current 74 and to achieve a surplus in funds amounting to $1 million.
ADFIAP, it was learned, has revenues streaming in mainly from membership dues, which are pegged based on the assets of a development bank applying to become a member. For banks with assets worth $1 billion or more, ADFIAP assesses a maximum annual membership due of $9,600. For those with only $100,000 in assets, the membership fee is pegged at the minimum of $1,000 per year.
Membership benefits include, among others:
• professional affiliation, status and recognition (affiliation with the World Federation of Development Financing Institutions, and invitations to events of the World Bank, Asian Development Bank, UN agencies and other international organizations);
• continuing education, credentialing and technical assistance (professional training and accreditation to the Asia-Pacific Institute of Development Finance, participation in CEO seminars, specialized training programs and technical assistance projects of the EU-Asia ProEco Programme, the International Trade Centre UNCTAD/WTO (ITC), the Center for International Private Enterprise (CIPE), Germany’s Capacity Building International (InWEnt), Japan’s Association of Overseas Technical Scholarships (AOTS) and other international organizations; and
• development banking information and publications, both printed and online, country exchange missions, study tour programs, on-the-job training, and other services.