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Business transactions were only started when several ports in the Philippines were opened to
foreigners. Most of the transactions were domestic banking because of the minimal trade outside
the Metro Manila.
Trading expanded when the Suez Canal opened in 1869. European Markets became accessible to
Philippine producers. The Banco Espaol-Filipino funded crops for exports and contributed to
countrys agricultural development. British banks dominated the countrys economy; they had
the advantage over other merchants on account of their facilities such as ships, connections with
China and Europe, credit resources, and techniques and machineries for large crop productions.
American Rule
- Free trade rule between United States and Philippines brought the substantial
increase of American economic control in Philippines
International Banking Corporation of New York set up an office in the country in 1902.
It generates more business in the Philippines.
In 1904 other banks were organized, such as Postal Savings Bank and the First
Agricultural Bank of the Philippines in 1906.
In 1916, the assets and liabilities of the agricultural bank were transferred to the newly
organized Philippine National Bank or PNB.
In 1948, the Central Bank of the Philippines was created and started its operation in
1949. Charged with the function of "preventing inflation and increasing the mobility of
the nation's capital", the Central Bank imposed import and foreign exchange controls to
conserve dollars and channel the country's monetary resources to industrialization.
Thrift bank is composed of savings and mortgage banks, private development banks,
stock savings and loan associations and microfinance thrift banks. Thrift banks are
engaged in accumulating savings of depositors and investing them. They also provide
short-term working capital and medium- and long-term financing to businesses engaged
in agriculture, services, industry and housing, and diversified financial and allied
services, and to their chosen markets and constituencies, especially small- and medium-
enterprises and individuals.
-Allied Savings Bank, BPI Savings Bank,HSBC Savings Bank, RCBC Savings
Bank
Rural and cooperative banks are the more popular type of banks in the rural
communities. Their role is to promote and expand the rural economy in an orderly and
effective manner by providing the people in the rural communities with basic financial
services. Rural and cooperative banks help farmers through the stages of production,
from buying seedlings to marketing of their produce. Rural banks and cooperative banks
are differentiated from each other by ownership. While rural banks are privately owned
and managed, cooperative banks are organized/owned by cooperatives or federation of
cooperatives.
-Bank of Makati, Insular Bank, Tanay Rural Bank,Zambales Rural Bank
Non- Bank Financial Institutions consist of private non-bank and government non-bank
financial institutions.
At end-2014, the country has 648 operating banks, 9,700 bank branches, 15,695 ATMS,
517 microfinance banking offices, and 271 banks with e-banking services (i.e., internet,
mobile, phone, e-wallet and remittance cards). 17,514 non-financial institutions such as
pawnshops and insurance companies.
In 1983, government corporations have been set-up to aid business in financial distress.
This was under taken by having government infused capital into these entities to save the
operating assets and to enable them to comply with their commitments. The other
strategy was to have government assume the control and management of private business
in crisis. Some were engaged in banking, hotel management, mining, air transportation
industry and construction. There are also a number that are involved in business
enterprises. However a number of these have been sold to private sectors and some
numbers of firms were on the verge of bankruptcy.
In 1989, NDC or National Development Company has been the engine of growth,
industrial pioneer and catalyst. Its strategy was to invest, operate until profitable, then sell
to private investors. It was established to be the investment arm of the government and
its mandate was to invest in pioneering and development-oriented project.
One is the Philippine Air Lines, the Manila Gas Corporation, National Housing
Authority, Manila Textile Mills and Cebu Portland Corporation were established by
NDC.
It was NDC which started almost all essential industries, breaking grounds in them,
operating them and after they have proved its viability, privatized them.
In 2010 there are 604 GOCC, 446 are operational water districts. The Executive Order
No. 936, the Creation of GCMC or Government Corporate Monitoring Committee and
Presidential Proclamation No. 50, Authorized the privatization of GOCC resulted to oly
158 GOCC, 84 are chartered and 74 under SEC.
REFERENCES:
Romano, Geneille B., Philippine Public Enterprises and Privatization, Fiscal Administration Inc,
1996
www.bsp.gov.ph/publication/media
http://www.slideshare.net/HermanLumanog/goverment-owned-and-contolled-corporation-gocc-
report
PUBLIC FINANCIAL SYSTEM AND PUBLIC
ENTERPRISES EXPERIENCES