Finance secretary Carlos Dominguez II is eyeing the possible makeover of the Development Bank of the Philippines (DBP) into an infrastructure bank to help carry out the Duterte administration’s growth agenda anchored on a spending program that aims to close the country’s infrastructure gap.
Dominguez mentioned his plan to high-ranking officials of the Daiwa Securities Group, Inc., led by its president and chief executive officer Seiji Nakata, after the latter had informed him of Daiwa’s collaboration with the DBP on investment banking advisory services.
“We are very happy about your good experience with the DBP. We want to improve the DBP. Our plan is to make it the Philippines’ infrastructure bank,” Dominguez said.
“The DBP, in my view, lost its way for a few years so we want to redirect it like the Development Bank of Japan (DBJ Inc.),” he added.
DBJ Inc. pioneered project financing in Japan, specifically in the sectors of energy and infrastructure.
The meeting with Nakata and other Daiwa executives was held recently in Yokohama, Japan on the sidelines of the 50th annual meeting of the Asian Development Bank.
Also present at Dominguez’s meeting with Nakata were Keio Tashiro, deputy head, International Operations; Hironori Oka, chairman and regional head of Daiwa Capital Markets Hong Kong Ltd.; and Kenji Nakanishi, president and chief executive officer, DBP-Daiwa Capital Markets Phils Inc.
Daiwa and DBP established a joint venture, the DBP Daiwa Capital Markets Philippines, in 1995.
As a result of this team-up, DBP and Daiwa later on expanded their collaboration to include investment banking advisory services. DBP currently supports the government’s infrastructure program by assisting public-private partnership (PPP) projects at the national and local government levels.
The bank’s priority lending areas, aside from micro, small and medium enterprises, include infrastructure and logistics, social services, and protection of the environment.
It recently granted a P550 million term loan to the Camarines Sur provincial government to finance the province’s various infrastructure programs, and has advised the Department of Transportation in the structuring, tendering and eventual award of the PPP contract for the P65-billion Light Rail Transit line 1 Extension, Operations and Maintenance Project.
Dominguez said DBP as an infrastructure bank can help its clients raise funds for projects by tapping the capital markets “and that’s where Daiwa can help, in the capital market side.”
SOURCE: Malaya Business Insight