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One Network Bank income end July nears 2004 level |
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By Ted P. Torres
The Philippine STAR 10/11/2005 One Network Bank (ONB), the country’s largest rural bank in terms of asset base and branch network, is optimistic that it could easily surpass its net income of P103.7 million registered last year. At the end of July this year, ONB already recorded a net income of P98 million, just P6-million short of income registered for the entire 2004. Gross income remained a healthy P381 million while its capital adequacy ratio (CAR) was a strong 17 percent. The Bangko Sentral ng Pilipinas (BSP) wants all banks to maintain a CAR of over 10 percent. The Mindanao-based rural bank reported total loan portfolio P2.4 billion after six months into 2005 and a total deposit base of P2.8 billion. So far, total assets stood at P3.76 billion. Non-performing assets (NPAs) ratio improved to 8.10 percent end July this year from 10.3 percent end 2004. Non-performing loan (NPL) ratio likewise improved to 6.97 percent end July from 8.9 percent at the start of the year. ONB president Alex V. Buenaventura revealed that the bank is seeking a foreign currency deposit unit (FCDU) license from the BSP which will allow the rural bank to service dollar deposits. "We also have a separate application that will allow us foreign exchange (forex) trading or a money-changing license," Buenaventura added. ONB is optimistic that the regulator will issue the FCDU license within the year to allow the bank to start servicing forex mainly remittances from overseas Filipino workers (OFWs). Money transfer businesses or remittances from OFWs last year and in the first six months of the year has been the leading fee-based earner for the bank. It has averaged P11 million per month in remittances with a P100 per transaction fee. The rural bank recently entered into a non-exclusive remittance agreement with Banco de Oro Universal Bank (BdO) allowing Filipinos abroad to access the BdOs overseas branch network to send money to relatives in Mindanao through ONB’s nearly 60 branches. It also has existing remittance-based alliances with the Philippine National Bank (PNB), the Rizal Commercial Banking Corp. (RCBC), Western Union, PetNet, MoneyGram, and UniTeller. They are also in talks with two major expanded commercial banks for similar arrangements. Aside from its branch network, ONB hopes to complete its ATM roll-out for the year of a total 40 units, including eight offsite units, to meet the needs of its bank clients and remittance business. Mindanao reportedly accounts for roughly $4-billion in remittance business of the $8.6-billion realized last year. It is expected to contribute roughly the same level this year where the National Government estimates remittances to expand to over $10 billion. Earlier this year, the Philippine Deposit Insurance Corp. (PDIC) declared ONB as the leader in terms of net income, total assets, gross loans, total deposits, and net worth among the country’s rural banks last year. It presently operates the largest branch and automated teller machines (ATMs) among rural banks. It is the first rural bank to get the nod of the Philippine Clearing House Corp. (PCHC) for its first-ever checking account. Dealing directly with PCHC, instead of a commercial bank acting as clearing bank, speeds up and expedites clearing of its own checking account. It also unlocks two-thirds of the reserve deposit block with the commecial bank thus allowing ONB to reallocate for lending. A product of a historic merger between three rural banks based in Mindanao, ONB operrates 58 branches and four more in the pipeline. Its ATM network already counts to 40 (including eight off-site). It seeks to complete a total network of 83 operating units between 2006 and 2007. |
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