City eyeing OFB as depository bank

A city councilor has proposed to include the Overseas Filipino Bank (OFB) as a depository bank of the city government aside from the Land Bank of the Philippines (LBP) and the Development Bank of the Philippines (DBP).

Councilor Danilo Dayanghirang, chair on committee on finance, ways and means, said tapping the OFB as the city government depository bank as it is promoting entrepreneurial and economic opportunities.

The city councilors approved the proposal for second reading.

The proposal stemmed from the May 10 letter of City Treasurer Bella Linda N. Tanjili to City Administrator Zuleika T. Lopez informing the latter about the May 8 letter of Arturo Cruz, branch head of the OFB, offering its products and services of the bank.

“This office (City Treasurer’s Office) cannot act on his (Cruz’s) request unless there is a new approved city council resolution stating that specifically that Overseas Filipino Bank is one of the authorized accredited depositories of city government funds,” said Tanjili in her letter to Lopez.

In a report, Dayanghirang’s committee said the city could invest in the bank as it helps promote entrepreneurship and offers economic opportunities to the city’s constituents.

The report added that Assistant City Treasurer Villa Dureza suggested that the city government can deposit P50 million with the OFB as its initial deposit, which Dayanghirang supported.

Although LBP objected to the proposal as OFB is its subsidiary, Dayanghirang pushed for the proposal because the investments in the bank come from overseas Filipino workers (OFWs) whom the government calls as “modern day heroes.”

First opened in 1906 as Philippine Postal Savings Bank, it was eventually closed 70 years later as it could not compete with the sprouting of privately-run banks. It was reopened in 1994 based on the provisions of Republic Act 7354, the Philippine Postal Corporation (PPC) charter. It was rebranded 19 years later as Postbank even as its operations were separated from the PPC.

In November 2016, LBP announced its desire to acquire the bank with the plan of converting it into a lending institution for OFWs and their relatives. About a year later, President Rodrigo R. Duterte issued Executive Order 44 transferring the shares of the bank to LBP and converting it into OFB.

The Bangko Sentral ng Pilipinas Monetary Board approved the LBP acquisition of the bank in December 2017 and that it was inaugurated a month later.

Posted in Business