GOING back to our column of March 19th on the potentials of expanding banking service in the community, Lapsus Calami made comments about it next day why people do not deposit money in banks, like not being able to afford it due to insufficient income; low interest paid by banks on deposit, and discouraging reports of people losing deposits in ATM accounts.
Lapsus was also correct of the big percentage of our population not doing business with banks. This is a call for banks to work for wider public acceptance of their service for people to deposit in banks instead of keeping cash at home.
Money deposited in banks acquires dual use: By the owner himself who can withdraw it anytime for his own purpose, as well as by the bank when consolidated with funds of other depositors. We wish that banks can make a massive information campaign for our people to fully appreciate the unique nature of banking service to the community.
You must have noted of the current moves of our government lining up several projects under our “Build, Build, Build” program to be funded by official development assistance (ODA) loan from China, as announced by the Department of Finance (DOF).
Finance secretary Carlos Dominguez III said two projects that we have in the pipeline for possible Chinese financing are the Davao-Samal Bridge Project in Mindanao and the Panay-Guimaras-Negros Inter-island bridge project in Western Visayas.
The Davao-Samal Bridge has an estimated cost of P9 billion, spanning 4.4 kilometers. The Panay-Guimaras-Negros Interisland Bridge Project, meanwhile, will be in two phases – 14.3 kilometers Panay-Guimaras link and 5.7 kilometers Guimaras-Negros link — and is estimated to cost P40 billion.
China has also extended a $62.09 million (P3.1 Billion) loan for the Chico River Pump Irrigation Project and a $211.21 million (P11.2 Billion) for the construction of the New Centennial Water Source – the Kaliwa Dam.
Dominguez further revealed that the Philippines and China are also working to begin the implementation of two rail projects the Subic Clark Railway Project in Luzon and the Mindanao Railway Project.
A lawmaker, Rep. Danilo Suarez of Quezon province expressed his view that it is better that loans to finance these projects are sourced from local financing. After all our banks are oozing with money at this time, he said.
We agree with Congressman Suarez’s stand for security and business reasons.
There are 54 universal/commercial banks operating in our country, 56 savings or thrift banks and 102 rural and cooperative banks.
For example, our Top 4 universal/commercial banks alone have resources reaching the trillion-peso mark. They are capable of lending funds to government projects, on top of their regular business:
* BDO Unibank Inc. – P2.78 trillion
* Metropolitan Bank & Trust Co. – P1.79 trillion
* Land Bank of the Philippines – P1.77 trillion
* Bank of the Philippine Islands – P1.70 trillion
Other banks with lesser assets may pool their resources to establish a special fund for additional lending to the government, if needed. There is the national security factor that we must consider. If our domestic banks can provide the money, why borrow from outside the country?
GEM OF THOUGHT
“It is important to remember that we cannot become what we need to be by remaining what we are.” – Max DePreee (For comments or re-actions, please e-mail to jnoveracompany@yahoo.com)/PN
