Thrift banks: Conduits for economic growth

Helping bridge the gap between the business market and the economy is certainly no easy feat which is why the thrift banking industry is considered as having a vital role in the country’s economy. They have continued to become promoters of economic growth, thanks in part to the government’s support. Last March 9, the Chamber of Thrift Banks (CTB) — the umbrella organization of the country’s 84 thrift banks, held its annual convention at the Dusit Hotel Nikko in Makati with the theme, "Thrift Banks: Government’s Partner in Promoting Economic Growth." Guest speakers who attended the event were Vice President Noli de Castro who talked about housing finance, Sen. Manny Villar who tackled the topic of SME lending and Bangko Sentral ng Pilipinas Governor Amando Tetangco Jr. who discussed the country’s economic prospects as well as the state of the thrift banking industry.

CTB convention chairman and second vice president, Pascual Garcia III shares that their goal for this year’s convention is to have "an improved interface between industry members and key consultants that will inspire us to do business better." He adds that the presence of Vice President de Castro, Senator Villar and BSP Governor Tetangco shows that they are the industry’s partners in economic growth. According to him, all three officials are proponents of microfinance, SMEs and housing in the country especially since "the industry plays a major role in the President’s economic agenda. Her policies are committed to the objectives of the industry and CTB members are encouraged by all the growth and development."

Meanwhile, CTB president Ambassador Alfredo Yao is proud to add the industry’s contributions to the country’s economy, "the thrift banking industry plays a vital role in the economy. They are considered as conduits of growth since they provide medium and long-term funds to the growth drivers of the economy namely: SMEs, socialized and low cost housing sector, and countryside businesses." According to Yao, the thrift banking industry always makes it a point to show their support to their depositors and borrowers, especially those from the countryside. He adds, "the industry continues to work towards promoting economic growth by providing financial assistance to these vital sectors of the economy."

Ambassador Yao also shares some of the key issues that have been raised in this year’s convention:

• Continued pursuit of CTB’s initiatives aimed at reducing the minimum capital requirements for thrift banks seeking authority to engage in limited trust functions and expanding authorized transactions of thrift banks with FCDU licenses to include investments in long-dated marketable securities;

• Legislation that will ensure prompt settlement of legal issues committed in respect of banks;

• Reduced Home Guaranty Corp. guarantee fees as a means of sustaining housing finance; and

• Address legislative and regulatory constraints to improve SME lending.

Together with the other members of the CTB, Ambassador Yao hopes that they will all work together in accomplishing their goals for 2007. Known for having created camaraderie among its members, Ambassador Yao cites the CTB’s Conventions and General Membership meetings as an excellent forum wherein members can participate in "a healthy exchange of ideas designed not only to promote the thrift banking sector but also to seek avenues toward contributing to the country’s economic and social goals." Ambassador Yao adds, "The CTB continues to pursue its mandate to foster mutual understanding, cooperation and goodwill among its members and stimulate an atmosphere conducive to "cooperative-competition." With so many things planned for 2007, the CTB is confident of the industry’s continued growth as it remains committed to its niche markets.