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FOR IMMEDIATE RELEASE CONTACT: Evelyn Mariano
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U.S. Industry Group Lauds Philippine Monetary
Board Consideration for Bancassurance
(Washington, DC) The US-ASEAN Business Council, representing leading US businesses with interests in the Philippines is hailing the Philippines' consideration of bancassurance, the selling of insurance products through banks. The Council cites the Monetary Board's July 22, 2002 decision to permit cross-selling of insurance products, a decision first made possible by the General Banking Law of 2000.
"The commitment of the Macapagal Arroyo administration to financial market reform in the Philippines is strong. Power sector privatization, securitization and financial services reform, are showing businesses that the Philippines is dedicated to keeping its investment and financial markets open for the greatest possible benefit to its value-minded consumers" said Ernest Z. Bower, President of the US-ASEAN Business Council.
A sophisticated cross-selling industry will benefit consumers in the Philippines as well as local and foreign banks and insurance firms. Bancassurance's approval by monetary authorities in 2000 has been slow to take form, but aims to promote progress toward open financial supermarkets and hypermarkets in the Philippines' future, keeping the country competitive among its regional neighbors.
The Monetary Board retained considerable limits on bancassurance, restricting the cross-selling of insurance products to banks that retain at least a 5% stake in affiliate insurance firms. The 5% requirement was arrived at by consensus among Monetary Board members, however, after considering a much loftier 51% requirement earlier this year.
Additional restrictions remain possible, such as limiting cross-selling to life insurance only or placing capitalization requirements. However, showing that bancassurance is ready to help financial market growth, the Philippines Insurance Commission is already prepared to issue approvals for insurance firms' non-deposit products.
The US-ASEAN Business Council is America's leading private business organization dedicated to promoting increased trade and investment between the United States and the member nations of ASEAN. The Council's membership includes approximately 150 of the Fortune 1000 American companies with trade and investment interests in the ASEAN region, and the council's members are represented in diverse industries, including aerospace, agribusiness, automobiles, computers and information technology, consumer goods, energy exploration and development, express delivery services, financial services, health care and pharmaceuticals, software, and telecommunications. For information on the US-ASEAN Business Council or general information on the ASEAN region, please contact John Goyer at jgoyer@usasean.org or visit the Council's Web site at www.us-asean.org.
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