Philippine Bank of Communications
Encyclopedia
The Philippine Bank of Communications , more commonly known as PBCom, is one of the largest commercial bank
s in the Philippines
, ranking nineteenth in terms of assets. The bank is also known for its towering headquarters, PBCom Tower
, the tallest building in the Philippines, located in Makati.
on August 15, 1939. It was incorporated and registered with the Securities and Exchange Commission
on August 23 and started operations on September 4. The bank started operations at the ground floor of the Trade and Commerce Building on Juan Luna Street, then the Wall Street
of the Philippines, in Binondo
, Manila
, with a staff of twenty men, all below the age of thirty and many fresh out of school.
During the Japanese occupation of the Philippines, PBCom followed most other banks at the time and closed operations. It resumed operations after World War II
in 1945 through the infusion of new financial capital
, although it had to operate from another building as its main offices at the time were used as the headquarters of General Douglas MacArthur
. Although it was not legally obligated to do so, PBCom announced that it would honor all pre-war accounts, saying instead that the war and subsequent occupation of the Philippines was merely a long bank holiday
that would have no effect on any depositary instrument PBCom had at the time. A year later, PBCom would join the Manila Clearing House Association.
On July 15, 1947, PBCom opened its first provincial branch in Cebu City
and leased a lot in front of its main office at the time a year later. By March 1953, PBCom's new six-storey headquarters was inaugurated. The bank's trust department was established in 1962 and its headquarters was remodeled in 1964, which included the retrofitting of the building to house Binondo's first escalator
.
On June 21, 1974, the then Chinese-owned PBCom was put under majority Filipino control with the purchase of a majority stake in the bank by Ralph Nubla and his company. The new management subsequently infused an additional 83 million pesos
in capital, and established its treasuries group later in the year. PBCom was subsequently accredited as a certified government securities dealer in 1981.
PBCom listed on the Manila and Makati Stock Exchanges (now the Philippine Stock Exchange
) in 1988 and reached an agreement with Filinvest Land to develop its properties on Ayala Avenue. In May 1997, the property was developed into the 52-storey PBCom Tower
, the bank's new headquarters and the tallest building in the Philippines. PBCom relocated its original Cebu City branch in 1999 and celebrated its sixtieth anniversary in September 1999. 2.6 billion pesos of fresh capital was infused in 2000 and PBCom subsequently acquired Consumer Savings Bank, a nineteen-branch savings bank
. The bank moved into PBCom Tower in 2001, occupying the first ten floors. Because of the move, PBCom subsequently refreshed its image with a new logo.
PBCom issued its first international credit card
, a MasterCard
issued in joint partnership with Standard Chartered Bank
, in 2002. It subsequently introduced online banking
in 2003 and was infused with an additional three billion pesos in fresh capital. As a show of support, the Philippine Deposit Insurance Corporation
gave PBCom an additional 7.64 billion pesos in financial enhancement funds, which formed part of PBCom's comprehensive business plan. The funds were really used to buy high-yielding government securities that would stop the true sale of any non-performing assets to a special purpose vehicle, or SPV. PBCom also welcomed its current president and CEO in 2005.
On November 22, 2006, Philtrust Bank
expressed their intention to buy 58% of PBCom, buying the stakes of the Nubla and Chung families. The Luy family, the owners of the largest share of PBCom, refused to talk about the deal. If it succeeded, it would have moved Philtrust up to the thirteenth largest lender in the country and the transaction would have been the fourth bank merger of that year, after the mergers of Prudential Bank into BPI
, International Exchange Bank
into Union Bank of the Philippines
and the Banco de Oro-Equitable PCI Bank merger
.
and the Philippine Deposit Insurance Corporation
.
and other banks. It also competes with major banks, such as Metrobank
, BPI
, Equitable PCI Bank
, Land Bank of the Philippines
and Philippine National Bank
.
Quite ironically, PBCom's headquarters is also home to the headquarters of a competitor bank, East West Bank
. East West Bank is based on the 20th and 21st floors of PBCom Tower.
Commercial bank
After the implementation of the Glass–Steagall Act, the U.S. Congress required that banks engage only in banking activities, whereas investment banks were limited to capital market activities. As the two no longer have to be under separate ownership under U.S...
s in the Philippines
Philippines
The Philippines , officially known as the Republic of the Philippines , is a country in Southeast Asia in the western Pacific Ocean. To its north across the Luzon Strait lies Taiwan. West across the South China Sea sits Vietnam...
, ranking nineteenth in terms of assets. The bank is also known for its towering headquarters, PBCom Tower
PBCOM Tower
The Philippine Bank of Communications Tower, more commonly known as PBCom Tower, is an office skyscraper that currently holds the title, since 2000, of the tallest building in the Philippines. It has a total ground to architectural top height of , with 52 storeys including an 8-level radio tower...
, the tallest building in the Philippines, located in Makati.
History
PBCom became one of the first non-American foreign commercial banks to operate in the Philippines (foreign because it was under Chinese control at the time) with the granting of its banking licenseBanking license
Under most jurisdictions, a banking license is a prerequisite for a financial institution that wants to provide banking services, such as taking deposits from the general public....
on August 15, 1939. It was incorporated and registered with the Securities and Exchange Commission
Securities and Exchange Commission (Philippines)
The Philippine Securities and Exchange Commission is a Philippine state commission responsible for securities laws and regulating the securities industry. The SEC is an agency within the Philippine Department of Finance....
on August 23 and started operations on September 4. The bank started operations at the ground floor of the Trade and Commerce Building on Juan Luna Street, then the Wall Street
Wall Street
Wall Street refers to the financial district of New York City, named after and centered on the eight-block-long street running from Broadway to South Street on the East River in Lower Manhattan. Over time, the term has become a metonym for the financial markets of the United States as a whole, or...
of the Philippines, in Binondo
Binondo, Manila
Binondo is an enclave in Manila primarily populated by ethnic Chinese living in the Philippines. Chinatown, Manila is the oldest Chinatown in the world, established in 1594. Historically, this was where the Spanish permitted converted sangleys, their indigenous Filipino wives, and their mixed-race...
, Manila
Manila
Manila is the capital of the Philippines. It is one of the sixteen cities forming Metro Manila.Manila is located on the eastern shores of Manila Bay and is bordered by Navotas and Caloocan to the north, Quezon City to the northeast, San Juan and Mandaluyong to the east, Makati on the southeast,...
, with a staff of twenty men, all below the age of thirty and many fresh out of school.
During the Japanese occupation of the Philippines, PBCom followed most other banks at the time and closed operations. It resumed operations after World War II
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...
in 1945 through the infusion of new financial capital
Financial capital
Financial capital can refer to money used by entrepreneurs and businesses to buy what they need to make their products or provide their services or to that sector of the economy based on its operation, i.e. retail, corporate, investment banking, etc....
, although it had to operate from another building as its main offices at the time were used as the headquarters of General Douglas MacArthur
Douglas MacArthur
General of the Army Douglas MacArthur was an American general and field marshal of the Philippine Army. He was a Chief of Staff of the United States Army during the 1930s and played a prominent role in the Pacific theater during World War II. He received the Medal of Honor for his service in the...
. Although it was not legally obligated to do so, PBCom announced that it would honor all pre-war accounts, saying instead that the war and subsequent occupation of the Philippines was merely a long bank holiday
Bank Holiday
A bank holiday is a public holiday in the United Kingdom or a colloquialism for public holiday in Ireland. There is no automatic right to time off on these days, although the majority of the population is granted time off work or extra pay for working on these days, depending on their contract...
that would have no effect on any depositary instrument PBCom had at the time. A year later, PBCom would join the Manila Clearing House Association.
On July 15, 1947, PBCom opened its first provincial branch in Cebu City
Cebu City
The City of Cebu is the capital city of Cebu and is the second largest city in the Philippines, the second most significant metropolitan centre in the Philippines and known as the oldest settlement established by the Spaniards in the country.The city is located on the eastern shore of Cebu and was...
and leased a lot in front of its main office at the time a year later. By March 1953, PBCom's new six-storey headquarters was inaugurated. The bank's trust department was established in 1962 and its headquarters was remodeled in 1964, which included the retrofitting of the building to house Binondo's first escalator
Escalator
An escalator is a moving staircase – a conveyor transport device for carrying people between floors of a building. The device consists of a motor-driven chain of individual, linked steps that move up or down on tracks, allowing the step treads to remain horizontal.Escalators are used around the...
.
On June 21, 1974, the then Chinese-owned PBCom was put under majority Filipino control with the purchase of a majority stake in the bank by Ralph Nubla and his company. The new management subsequently infused an additional 83 million pesos
Philippine peso
The peso is the currency of the Philippines. It is subdivided into 100 centavos . Before 1967, the language used on the banknotes and coins was English and so "peso" was the name used...
in capital, and established its treasuries group later in the year. PBCom was subsequently accredited as a certified government securities dealer in 1981.
PBCom listed on the Manila and Makati Stock Exchanges (now the Philippine Stock Exchange
Philippine Stock Exchange
The Philippine Stock Exchange is the national stock exchange of the Philippines. It is one of the oldest stock exchanges in Southeast Asia, having been in continuous operation since its inception in 1927...
) in 1988 and reached an agreement with Filinvest Land to develop its properties on Ayala Avenue. In May 1997, the property was developed into the 52-storey PBCom Tower
PBCOM Tower
The Philippine Bank of Communications Tower, more commonly known as PBCom Tower, is an office skyscraper that currently holds the title, since 2000, of the tallest building in the Philippines. It has a total ground to architectural top height of , with 52 storeys including an 8-level radio tower...
, the bank's new headquarters and the tallest building in the Philippines. PBCom relocated its original Cebu City branch in 1999 and celebrated its sixtieth anniversary in September 1999. 2.6 billion pesos of fresh capital was infused in 2000 and PBCom subsequently acquired Consumer Savings Bank, a nineteen-branch savings bank
Savings bank
A savings bank is a financial institution whose primary purpose is accepting savings deposits. It may also perform some other functions.In Europe, savings banks originated in the 19th or sometimes even the 18th century. Their original objective was to provide easily accessible savings products to...
. The bank moved into PBCom Tower in 2001, occupying the first ten floors. Because of the move, PBCom subsequently refreshed its image with a new logo.
PBCom issued its first international credit card
Credit card
A credit card is a small plastic card issued to users as a system of payment. It allows its holder to buy goods and services based on the holder's promise to pay for these goods and services...
, a MasterCard
MasterCard
Mastercard Incorporated or MasterCard Worldwide is an American multinational financial services corporation with its headquarters in the MasterCard International Global Headquarters, Purchase, Harrison, New York, United States...
issued in joint partnership with Standard Chartered Bank
Standard Chartered Bank
Standard Chartered PLC is a multinational financial services company headquartered in London, United Kingdom with operations in more than seventy countries...
, in 2002. It subsequently introduced online banking
Online banking
Online banking allows customers to conduct financial transactions on a secure website operated by their retail or virtual bank, credit union or building society.-Features:...
in 2003 and was infused with an additional three billion pesos in fresh capital. As a show of support, the Philippine Deposit Insurance Corporation
Philippine Deposit Insurance Corporation
The Philippine Deposit Insurance Corporation is a government-run Philippine deposit insurance fund. It was established on June 22, 1963 by Republic Act 3591. It guarantees deposits up to P500,000.-External links:*...
gave PBCom an additional 7.64 billion pesos in financial enhancement funds, which formed part of PBCom's comprehensive business plan. The funds were really used to buy high-yielding government securities that would stop the true sale of any non-performing assets to a special purpose vehicle, or SPV. PBCom also welcomed its current president and CEO in 2005.
On November 22, 2006, Philtrust Bank
Philtrust Bank
Philtrust Bank , formally known as the Philippine Trust Company, is one of the oldest private commercial banks in the Philippines. Founded on October 16, 1916, its history parallels the growth of the Philippine banking system...
expressed their intention to buy 58% of PBCom, buying the stakes of the Nubla and Chung families. The Luy family, the owners of the largest share of PBCom, refused to talk about the deal. If it succeeded, it would have moved Philtrust up to the thirteenth largest lender in the country and the transaction would have been the fourth bank merger of that year, after the mergers of Prudential Bank into BPI
Bank of the Philippine Islands
Bank of the Philippine Islands is the oldest bank in the Philippines still in operation and is the country's third largest bank in terms of assets, the country's largest bank in terms of market capitalization, and the country's most profitable bank...
, International Exchange Bank
International Exchange Bank
International Exchange Bank, more commonly known as iBank, was one of the largest banks in the Philippines, ranking within the top twenty in terms of assets. It was recently acquired by the larger Union Bank of the Philippines in mid-2006, although the two banks remained separate...
into Union Bank of the Philippines
Union Bank of the Philippines
Union Bank of the Philippines more commonly known as UnionBank, is one of the largest banks in the Philippines, ranking seventh in terms of assets after its successful merger with smaller competitor International Exchange Bank...
and the Banco de Oro-Equitable PCI Bank merger
Banco de Oro-Equitable PCI Bank merger
The Banco de Oro-Equitable PCI Bank merger was a plan by the SM Group of Companies and Banco de Oro Universal Bank, the fifth-largest bank in the Philippines, to merge with Equitable PCI Bank, the third-largest bank...
.
Ownership
- Luy family: 37%
- Nubla family: 28%
- Chung family: 26%
- Others (includes public stock): 9%
Subsidiaries and affiliates
PBCom does not have any subsidiaries or affiliates. It is, however, a member of BancNetBancNet
Bancnet, Inc. is a Philippine-based interbank network connecting the ATM networks of more than forty local banks. It is considered the largest interbank network in the Philippines in terms of the number of member banks and annual transactions...
and the Philippine Deposit Insurance Corporation
Philippine Deposit Insurance Corporation
The Philippine Deposit Insurance Corporation is a government-run Philippine deposit insurance fund. It was established on June 22, 1963 by Republic Act 3591. It guarantees deposits up to P500,000.-External links:*...
.
Competition
PBCom competes with other commercial banks, such as International Exchange BankInternational Exchange Bank
International Exchange Bank, more commonly known as iBank, was one of the largest banks in the Philippines, ranking within the top twenty in terms of assets. It was recently acquired by the larger Union Bank of the Philippines in mid-2006, although the two banks remained separate...
and other banks. It also competes with major banks, such as Metrobank
Metropolitan Bank and Trust Company
The Metropolitan Bank and Trust Company , commonly known as Metrobank. It has a diverse offering of financial services, from regular banking to insurance. Metrobank is the second largest bank in the Philippines.-History:...
, BPI
Bank of the Philippine Islands
Bank of the Philippine Islands is the oldest bank in the Philippines still in operation and is the country's third largest bank in terms of assets, the country's largest bank in terms of market capitalization, and the country's most profitable bank...
, Equitable PCI Bank
Equitable PCI Bank
Equitable PCI Bank was one of the largest banks in the Philippines, being the third-largest bank in terms of assets. With PCI Bank the largest bank before it was overtaken by Metrobank in 1995. It is the result of the merger of Equitable Banking Corporation and Philippine Commercial International...
, Land Bank of the Philippines
Land Bank of the Philippines
Land Bank of the Philippines , also known as LANDBANK or by its initials, LBP, is a bank in the Philippines owned by the Philippine government with a special focus on serving the needs of farmers and fishermen...
and Philippine National Bank
Philippine National Bank
The Philippine National Bank is one of the largest banks in the Philippines, ranking fourth in terms of assets...
.
Quite ironically, PBCom's headquarters is also home to the headquarters of a competitor bank, East West Bank
East West Bank (Philippines)
EastWest Bank, more formally known as East West Banking Corporation, is a medium-sized commercial bank in the Philippines and the first commercial bank to be licensed in twenty years...
. East West Bank is based on the 20th and 21st floors of PBCom Tower.