Could you provide a brief journey of how you arrived where you are today?
I started as a general clerk in 1972 in one of the commercial banks in the Philippines. In 1983 I was working with a foreign bank up to 1996. My main concentration then was investment banking and capital markets. In 1996, I moved to a government bank, the Development Bank of the Philippines (DBP), and held various senior level positions, the latest of which was as senior executive vice president and head of the marketing sector. Here I was responsible for taking the lead in major corporate lending, finance deals and underwriting issues before I was appointed as chairman and CEO of Al-Amanah Islamic Investment Bank of the Philippines (AAIIBP).
What does your role involve?
As chairman of the board, I participate in the deliberation of policy issues and preside over meetings of the board of directors. As CEO, I implement policies and oversee the entire operations of the bank to help support the development of DBP’s initiatives for micro, small and medium entrepreneurs. I also handle the relationship affairs of the bank, especially on top level negotiations.
What is your greatest achievement to date?
Other than the refurbishment of our branches and introduction of online banking, we are also building our loan portfolio while implementing the five-year rehabilitation program of the bank.
Which of your products / services deliver the best results?
As we are just starting our rehabilitation program this year, we cannot quantify nor qualify yet which product or service gives best results. We need time to do it. To date, we offer both conventional and Islamic products. When DBP took over management of the bank, there were conventional deposits in our portfolio that we have to continue servicing. However, the bank is targeting full Islamic operations within the five-year rehabilitation program.
What are the strengths of your business?
We are the only Islamic bank in the country, with a population of about nine million. AAIIBP covers the area of the autonomous region for Muslim Mindanao, with eight branches located in major cities of Mindanao. We are also a state-owned bank. The bank gains the support of the government through the DBP, which is another state-owned financial institution.
What are the factors contributing to the success of your company?
The full support of the government and all regulating bodies in the country help to promote our business. We also have a dedicated and motivated workforce, the majority who are Muslims that easily relate to the target market of the bank. With the improvement of our office facilities and upgrading of our information technology processes, the bank is hopeful that we will be able to attain our budget.
What are the obstacles faced in running your business today?
The first is the level of familiarity of Islamic banking in the Philippines. There are very few Filipinos, and even Muslims that are familiar with Islamic finance.
Secondly, the insurance matter for Islamic deposits. We do not have Takaful yet in the Philippines. Compared to the assurance of the state on insurance coverage up to PHP500, 000 (US$11,000) per account for conventional deposits through the Philippine Deposit Insurance System, we cannot promise anything yet to Islamic depositors except the guarantee of return of deposit when demanded.
Additionally, the regulatory framework is not yet in place. Our central bank is still in the process of organizing the framework for Islamic banking, in coordination with other agencies of the government for the tax and property laws.
Where do you see the Islamic finance industry in, say, the next five years or so?
In the Philippines, Islamic finance as a new dimension where we have to exert extra effort to introduce the banking system. With the help of other Islamic institutions in the region that can provide training and exposure to interested players, we see it as a sunrise industry in the next five years.
Name one thing you would like to see change in the world of Islamic finance.
Since we are still in the infant stage of Islamic banking, what we want to see is the recognition that Islamic banking can be carried out in our country. We want the Islamic finance world to recognize that there is Islamic business in the Philippines.