Middle East Banks Eye Al-Amanah

The government expects to privatize Al-Amanah Islamic Investment Bank of the Philippines (AAIIBP), the only bank in the country authorized to offer Islamic banking services, in a year as two Middle Eastern banking institutions are seriously in their acquisition bid.

AAIIBP, now a subsidiary of Development Bank of the Philippines, has been put on sale by the government for a year already.

Trade and Industry undersecretary Cristino L. Panlilio revealed that Al-Amanah is one banking institution in the country that Middle Eastern investment banking companies are looking into.

''We have Al-Amanah now and we are selling it at the right price. We are talking to at least two Middle Eastern banks now,'' Panlilio said, who refused to identify the two Middle Eastern banks.

Panlilio said that Al-Amanah has a license with the DBP and the license can be sold to interested parties.

''Regardless of the signing of the Bangsamoro, we can sell it one year because we've been selling it for a year already. This Bangsamoro only came up in the past two weeks.''

During the signing of the Framework Agreement for the Bangsamoro, President Aquino was quoted saying that investments in banking aside from food and education are expected to flow into the Bangsamoro region.

Al-Amanah is now on its third year of its five-year rehabilitation plan approved by the Monetary Board on October 22, 2009 focusing on four corporate strategies (4Rs), namely, Recapitalization, Restoration of Financial Viability, Reorganization and Reforms Institutionalization. Under the Rehabilitation Plan, AAIIBP is allowed to continuously do both conventional and Islamic banking.

In November 2009, the DBP infused P1.0-billion capital to Amanah Bank that marked the partial completion of the recapitalization strategy.

The bank's rehabilitation plan came after it was acquired by the government through the DBP, which took full control of the bank's operations on July 16, 2008.

On October 30, 2008, DBP completed the acquisition of the shareholdings of the National Government, the SSS and the GSIS in AAIIBP, thereby controlling 99.9% of the Bank.

From 1990 to 2007, AAIIBP managed its operation with the support of the Bureau of Treasury.

The Amanah Islamic Bank was first established as ''Philippine Amanah Bank'' by virtue of Presidential Decree No. 264 by then President Ferdinand E. Marcos. The decree required the Bank to invest 75%of its total loanable funds for the purpose of providing, among others, reasonable medium and long-term credit facilities to the people of the Muslim-dominated provinces of Cotabato, South Cotabato, Lanao del Sur, Lanao del Norte, Sulu, Basilan, Zamboanga del Norte, Zamboanga del Sur and Palawan.

This transformed Al-Amanah into a development bank with an initial capitalization of P50 million.

In 1974, Presidential Decree No. 542 was issued directing the Bank to implement the Islamic concept of banking, following the ''no interest principle'' and the partnership principles. This directive was not fully carried out because conventional banking still dominated the bank's operations.

When the Autonomous Region in Muslim Mindanao was established, the administration of then President Fidel V. Ramos passed Republic Act No. 6848, otherwise known as the Charter of Al-Amanah Islamic Investment Bank of the Philippines (AAIIBP) in 1990.

The new charter reenergized the bank with an authorized capital stock of P1 billion consisting of 10 million common shares.

AAIIBP has the mandate to promote and accelerate the socio-economic development of the Autonomous Region of Muslim Mindanao (ARMM) through banking, financing and participating in agricultural, commercial and industrial ventures based on the concept of Islamic banking.

By mid-1990, three of its branches, Cotabato, Marawi and Jolo, have been transformed into accepting Islamic deposits. The other branches have been transacting both conventional and Islamic banking products, services and facilities.

Loading...

Editor’s note:Yahoo Philippines encourages responsible comments that add dimension to the discussion. No bashing or hate speech, please. You can express your opinion without slamming others or making derogatory remarks.

  • Sandigan OKs hospital stay for GMA co-accused
    Sandigan OKs hospital stay for GMA co-accused

    The Sandiganbayan has allowed a government official, accused with plunder along with former President and now Pampanga Rep. Gloria Macapagal-Arroyo to undergo a medical procedure at a hospital tomorrow. The anti-graft court permitted former Philippine Charity Sweepstakes Office (PCSO) board member Benigno Aguas to undergo a cardiopulmonary/endocrine clearance at the St. Luke’s Medical Center in Quezon City. …

  • Sandigan recommends executive clemency for ex-envoy
    Sandigan recommends executive clemency for ex-envoy

    The Sandiganbayan has recommended executive clemency for a former Philippine ambassador to Nigeria who was sentenced to 52 years for malversation of public funds. The Sandiganbayan First Division found Masaranga Umpa guilty of misusing the Assistance-To-Nationals Stand-by Funds totaling $80,478.80 in 2007, but the anti-graft court said the former assemblyman from Lanao del Norte should be pardoned. …

  • Stargazing at the mall highlights Earth Hour
    Stargazing at the mall highlights Earth Hour

    It was a night of stargazing in 58 SM Supermalls all over the country last night as these establishments participated in Earth Hour, an annual worldwide movement encouraging communities and establishments to switch off lights for one hour to raise global awareness of overuse of non-renewable resources. The Philippines has been an active participant of Earth Hour since 2008. Last night, in the province of Bulacan, for instance, all parishes, diocesan institutions, schools and household …

  • Payanig privatization hit
    Payanig privatization hit

    BLEMP Commercial of the Philippines, Inc. (BLEMP) denounced the recent announcement of the Presidential Commission on Good Government (PCGG) to privatize the 18.4-hectare “Payanig sa Pasig” property. In a statement sent to The STAR, BLEMP lawyer Dennis Manalo said the PCGG has no right to auction the property because it has no valid title and is not in possession. The PCGG has not paid a single centavo in real property taxes for the property, he said. He narrated that it was in the early 70s …

  • New species of tarantula found
    New species of tarantula found

    Scientists from the Museum of Natural History (MNH) of the University of the Philippines-Los Baños have discovered a new species of cave-dwelling tarantula on an island off the coast of Quezon. The new species of the spider, Phlogiellus kwebaburdeos, was described in the recent issue of the Philippine Journal of Systematic Biology by MNH curators for spiders Aimee Lynn Dupo and Alberto Barrion along with their former student Joseph Rasalan. The tarantula was discovered by Rasalan during one …

  • Palm Sunday: Do not add to suffering of others
    Palm Sunday: Do not add to suffering of others

    As Christendom enters Holy Week today, Palm Sunday, an official of the Catholic Bishops’ Conference of the Philippines (CBCP) yesterday called on the faithful not to add to the sufferings of their fellowmen. Jerome Secillano, executive secretary of the CBCP-Episcopal Commission on Public Affairs (ECPA), said that while Palm Sunday is oftentimes remembered as the glorious arrival of Jesus Christ in Jerusalem, it also signals the start of the Holy Week that tells of His suffering, death and …

  • Miriam pushes tougher graft law
    Miriam pushes tougher graft law

    Sen. Miriam Defensor-Santiago has filed a bill that would make public officials liable for violations of the Anti-Graft and Corrupt Practices Act even if they are elected to a fresh term or a new position. In filing Senate Bill 2716, Santiago sought to address what she said was the doctrine of condonation in Philippine jurisprudence brought about by the 2010 case of Salumbides vs. Ombudsman. “By merely asserting the doctrine of condonation, erring elective officials are automatically given a …

  • Phl hits back at China over sea infra work
    Phl hits back at China over sea infra work

    The Philippines assailed China yesterday for contesting Manila’s planned repair and maintenance works on some islands in the West Philippine Sea, saying they are “in no way comparable” to the Asian power’s massive reclamation activities which are in violation of international laws. “The Philippines’ possible undertaking of necessary maintenance and repairs on its existing facilities in the West Philippine Sea, over which the Philippines rightfully exercises sovereignty, sovereign rights and …

POLL

Should Aquino be held accountable over the Mamasapano operations?

Loading...
Poll Choice Options