MANILA, Philippines - International Finance Corp. (IFC), the private sector investment arm of the World Bank Group, is investing P650 million into Philippine Resources Savings Bank, a multi-branch thrift bank based in Cauayan City, Isabela.
IFC resident representative to Manila Jesse Ang said their investment in PR Savings Bank would enable the World Bank Group to help farmers, teachers and small entrepreneurs in rural areas gain greater access to credit to improve their incomes and contribute to the economy’s inclusive growth.
Ang said IFC’s capital infusion to PR Savings would allow the country’s fifth largest independent thrift bank to strengthen its balance sheet and expand lending in rural areas. It is the largest savings bank in Region II.
The IFC official noted that poverty in agricultural households is about three times higher than those in other sectors. Only one in four Filipino adults has an account in a bank or other financial institution.
“Some 80 percent of micro and small enterprises in the Philippines have no access to formal credit. IFC’s investment in PR Savings helps address this gap, particularly in rural areas where 70 percent of poor Filipinos live,” Ang said.
PR Savings president and CEO Roberto Alingog said “IFC’s partnership will give us access to its global knowledge in microfinance, agribusiness finance, and small and medium enterprise banking, as well as to best practices in risk management and corporate governance.”
“This will enable PR Savings to grow further, particularly in provincial areas where access to finance is limited,” he said.
Founded in 1977, PR Savings has 102 branches and off-branch offices mostly in rural areas.
The bank focuses on providing motorcycle financing, agribusiness loans to small farmers, microfinance loans to women, and salary loans for public school teachers. About 45 percent of the bank’s borrowers are women.
In May 2011, the Bangko Sentral ng Pilipinas approved its upgrade from a rural bank to a savings bank.
IFC is the largest global development institution focused exclusively on the private sector.
In the Philippines, it has various investments in other financial institutions such as BDO Unibank Inc., Planters Bank, Bank of Philippine Islands, Rizal Commercial Banking Corp. (RCBC) and PR Rural Bank of Nueva Ecija.
Ang, in an earlier interview with The STAR, said one of IFC’s major thrusts this year is acquire more rural banks as part of its support to the Philippine banking industry.
“Our 2014 plan will include investment in financial institutions. The financial sector is very important for us. We are looking at big rural and microfinacing institutions,” he said.
IFC’s investments climbed to an all-time high of nearly $25 billion last year, leveraging the power of the private sector to create jobs and tackle the world’s most pressing development challenges.