Now in its initial year of implementation is the Five-Year Strategic Plan for the Philippine Postal Bank which the new management prepared in 2011. the plan was crafted in response to a requirement of the Bangko Sentral.lt is also designed to provide operational guidance to the new bank leadership as it steers the Bank towards sustained growth in the next five years. The Strategic Plan is divided into three parts where we are, where we want to be, and how do we get there.
These are summarized below:
The PostaiBank is a government thrift bank established in 1906 by the then Bureau of Posts to mobilize savings, provide access to credit and financial services in the countryside.
The Bank ranks 15th by Total Assets among 73 savings banks in the Philippines, with assets of P6 Billion, it is however dwarfed by two private savings banks (BPI Family with P147 Billion and PSBank with P119 Billion).
Other financial data for PostaiBank are (as of 2011) Deposits, P4.5 B; Loans, P2.2 B; Investments, P2.4 B; Resources, P4.6 B; Capital, P246 Million; Net Income, P4.5 Million.
The PostaiBank has been posting profitable operations all these years, but the profits have been modest and fluctuating within a small positive band year after year. with no real breakthrough in a specific year.
This is to be expected, because the Postal Bank has inherent financial and operational weaknesses which mitigate against remarkable achievements. For one thing, it is undercapitalized, and its hope of becoming a major depository bank of government is still to be realized. Operationally, it is vulnerable to political and bureaucratic influences, and this is seen many facets of management- from the ability to attract highly competent manpower so crucial in the highly competitive banking system, to the ability to install state-of-the-art management, operating, and financial systems.
The above explains why the Bank, after such a long period of existence, continues to have little impact on its mission to become a major countryside
development bank. Almost left to itself, the Bank plods along almost akin to a private thrift bank, preoccupied with the traditional products and services it needs to sell to keep itself afloat, and wishing that, one day it would build a financial base strong enough to enter into the developmental areas so critically needed by the rural banking environment.
Where We Want To Be
The Strategic Plan has set growth targets which, in the next five years, are aimed at achieving the following:
- The Postal Bank should be able to position itself as the government's countryside development bank, providing financial services to "unserved" rural communities and extending financial assistance in the delivery of basic services such as water, power, infrastructure, and small agricultural facilities.
- The Bank Will become one of the 10 top thrift banks In the industry. Currently it ranks 15th among the 73 thrift banks, certainly a respectable level but with plenty of room for improvement considering that the top 10 have double digit assets.
- Rather than serving merely as a savings and loan institution, the Bank will be known for its services/development programs as it befits a public bank- which are responsive to community development, cultural minorities upliftment, and people empowerment.
- The Bank will have a core of competent and dedicated professional staff who share in the Bank's vision and will contribute to the fulfillment of the Bank's economic development mandate.
HOW DO WE GET THERE
The Five Year Strategic Plan has identified four tasks for achieving its objectives.
- Achieve a strong financial position. By the end of 2016, the Banks is set to achieve P17 Billion in assets, lend at least P9 Billion, generate P15 Billion in deposits, and increase capitalization to P1.5 Billion.
- Establish a presence in the "unbanked" rural areas by doubling the number of branches to 5O and utilizing the 1800 postal offices in all towns across the country as satellite stations/ kiosks to service the basic banking and remittance needs.
- Offer the full range of traditional banking products and services as well as new ones that will service specific target markets in the countryside, as well as source soft loans/grants from international and regional financial institutions.
- Establish a reputation as a reliable and trustworthy bank deserving of the highest level of respect from its various publics clientele and colleagues, the industry, financial institutions, and the general public.
Enabling components to accomplish tasks
Geographic Outreach Plan
The anchor of the plan is to expand the outreach network of the Bank in practically all corners of the country.
- By doubling the number of branches to SO by the year 2016.
- By utilizing the 1800 postal offices of Phil post as satellite kiosks / stations for extending financial transactions to the unbanked rural communities.
This partnership with Phil post was recently formalized with the signing of a Memorandum of Agreement between the two institutions. Compliance with BSP requirements is now being worked out, and preparations are underway for the pilot testing of the Bank-Post Office tie-ups organizationally and operationally to include IT systems for remittances, deposit generation, and loan generation.
Business Improvement Plan
The focus in this area are:
- The improvement of the traditional products and services of the Bank (Deposits, loans, etc.).
- The development of new products to cater to both traditional and new markets, viz: for 2012- cash cards, Remittance (money transfers), Bills Payment Services; for 2013-16, Electronic Document Exchange (payment for Census, Taxes, SSS and GSIS contributions, etc.)
- Tie up with PPC for domestic and international remittance.
- Establish programs relevant to community development and people empowerment.
While the PostaiBank has long been in existence, 1t 1s hardly known in Metro Manila, much less outside of it. A communications Plan has been drawn up to develop a corporate identity for the Bank, create public awareness of its existence and products and services, support the Bank's marketing and sales program, and build up trust and confidence in the Bank.
Various activities and programs are underway or being planned to implement the communications plan, including the creation of a new logo, advertising and public relations, etc. in support of the effort to create a new public image for the Bank.
Governance Improvement Plan
One of the weaknesses identified in the management of the Bank was in the area of governance. Specifically, three tasks were stressed:
- The need to realign and restructure the organization, strengthen the management staff, and develop its employees.
- The need to complete the Manual of Policies and Operations required of banks, and
- The need to install a responsive Information Technology System.
The Five Year Plan is now addressing these three areas of concern: A reorganization of manpower is now underway to come up with a flatter and more responsive structure, with the requisite components of personnel recruitment, manpower development and performance management. The completion of 18 policies and operations manuals required of banks has been given priority, and 10 of these have so far been updated and completed. An IT system has been developed and is being installed to provide timely and updated information needed for decision-making.
To strengthen the financial condition of the Bank, the following action plans are being implemented:
- Capital Build-up. Infuse capital from various sources such as Phil post, other government agencies and international funding institutions. Talks are now underway with such agencies as LWUA, PCSO and PAGIBIG.
- In crease Deposits. More aggressive deposit generation activities from LGUs, government institutions, private companies, occupational groups, and individuals using the Bank branches and the postal network.
- Lending Operations. Increase utilization of loanable funds to 90% in the five year period with focus on salary and consumer loans to government and private sectors, developmental loans to LGUs and loans to small and medium enterprises.
- Remittance and Fees/Commission Income. The Bank shall provide remittance services (international and domestic), Bills Payment, and Cash Cards, capitalizing on Bank and Philpost synergy of operations.
Read The Complete 5 Year Plan Here.