Answer to Question #299025 in Management for Kizia

Question

Instruction: Search on the internet for existing financial institutions operating in the Philippines under the following classification.

As a Business student, you will search for the following financial institutions.

1. Universal Bank

2. Financial Intermediaries

3. Commercial Bank

4. Savings and loan associations

You need to describe the organization and operation, its services offered, and the scope of operation. You will also include the current situation these financial institutions are facing during this pandemic.

You need to analyze, interpret and evaluate the situation, and give your recommendation.

Answer 1

1.     Universal Bank

In the Philippines' both Universal and commercial banks represent the largest financial institution in the country. Universal banks are mandated to carry out functions like house investments. In recent years, universal banks have increased performance due to diversification in the economic sector. The first universal bank was established in 1980 in the Philippines. Some examples of universal banks include; Ban of Philippine Islands, BDO Unibank, Metropolitan Bank, Trust Company, and Land Bank of the Philippines. These banks have been recognized as essential for economic growth due to their insurance and security trading services.

2.     Financial Intermediaries

A financial intermediary is an institution that acts as an intermediary between two parties involved in financial activities. Financial intermediaries are more like banks in handling assets, services providence and the nature of clients. The roles of financial intermediaries in the Philippines have evolved in the past years. The evolutions are a result of the dominating banks in Philippine economic systems. Financial intermediaries increase the influence of monetary policy on the economy. Furthermore, their role in the Philippines is to promote financial markets' development.

3. Commercial Bank

Most people do their banking in commercial banks. The roles of commercial banks in the Philippines are savings, deposits, and loans. In the Philippines commercial banks are regulated by Bangko Sentral ng Pilipinas (BSP). Before COVID-19 Philippines had a higher performance rate GDP, and its growth rate was 6.6% from 2012 to 2019, while in 2020, it dropped to $3,450 from $3850. In 2021 the leading commercial bank in the Philippines was BDO Unibank Inc, with 411.45 billion Philippine pesos.

4. Savings and loan associations

The role of loan associations in the Philippines is to provide loans that do not exceed the borrower's savings. Also, to charge interest as per the law and collect fees of loan granted. In 2020 the World Bank approved a $500 million loan to help the Philippines mitigate the COVID-19 pandemic. The Philippine Emergency response supported 18 million vulnerable people across the region who were severely hit by the pandemic.