The Philippines is now considered among Japan’s favored investment destinations in Asia after the Bank of Tokyo Mitsubishi UFJ Ltd. infused P36.9 billion into Security Bank Corp., Trade Secretary Adrian Cristobal Jr. said Tuesday.
The Bank of Tokyo, Japan’s largest financial institution, finally completed its 20-percent investment in Security Bank on Friday. The amount was the biggest investment so far by a foreign company in the country’s financial institution,
“The completion of the deal emphasizes how the Philippines is now among Japan’s most favored investment destinations in Southeast Asia,” Cristobal said in a statement.
Cristobal said BTMU’s capital infusion came at a time as the government ratchets up the country’s investment priorities plan to put more weight on cooperation with foreign investors and ensure stability in the country’s business climate.
“Japan’s outlook of the Philippines has been quite favorable more so because the country is showing robust economic growth. Our track record of consistent growth has been catching the attention of Japanese investors and it has become more attractive compared to other economies in the region,” Cristobal said.
The country’s sustained economic growth and its young, burgeoning population are among the reasons why Japanese companies including small and medium enterprises are looking at the Philippines as part of their investment strategies in Asia and Oceania.
“The Bank of Tokyo-Mitsubishi’s entry has surely prompted not only other foreign financial institutions but prospective foreign investors in business and industry to take a more serious look at the Philippines and what it has to offer,” Cristobal said.
The strategic tieup between Security Bank and BTMU aims to deepen BTMU’s presence in organic communities and provide its strong base of Japanese customers with better banking services through Security Bank.
Security Bank received a capital investment of P36.9 billion from BTMU. In turn, the bank issued 150,707,778 common shares and 200,000,000 preferred shares to BTMU, representing Japan’s top lender 20-percent ownership of the voting stock in Security Bank.
Go Watanabe, chief executive officer for BTMU Asia & Oceania, said the strategic alliance with Security Bank was aligned with the bank’s expansion plans in Asia.
BTMU is now the second largest shareholder of Security Bank, while the Dy family remains the biggest shareholder of Security Bank with majority voting control.
Some foreign chambers in the Philippines have already acknowledged the country as the next promising investment hub in Asia as investors look beyond China due to rising costs, increased government regulation, and flagging economy.
Many Japanese companies are looking to exploit opportunities in other emerging markets like the Philippines to trim costs and reduce overdependence on the world’s second largest economy.