Investment Banking in Philippines

Updated on February 12, 2024
Article byWallstreetmojo Team
Edited bySusmita Pathak
Reviewed byDheeraj Vaidya, CFA, FRM

Investment Banking In Philippines Overview

Investment banking in Philippines is one of the most significant parts of the financial industry that helps entities raise funds, and also engage in fruitful merger and acquisition (M&A) deals. In the Philippines, the banking sector is pretty wide, and many banking and non-banking institutions offer a whole gamut of services.

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Source: Investment Banking in Philippines (wallstreetmojo.com)

The Philippine Stock Exchange has witnessed a surge in the listings and the credit for making this happen goes majorly to the investment banking services that the entities offer. The investment banks in the region help firms raise capital through various public offerings, including initial public offerings (IPOs).

Investment Banking in Philippines Explained

Investment banking in Philippines has been a crucial part of the financial interface of the region. From helping firms to raise funds for growth and expansion of their businesses to guiding companies choose better deals involving mergers and acquisitions. Investment banks not only serve to be a facilitator of financial transactions but also act as a guide and mentor for several investors. The diverse role that it plays makes it one of the most wanted sectors of any nation.

This sector ensures maintaining sustainability and managing risks by having flexible measures designed per individual requirements of the clients. It takes into account the changing trends and regulations, watching out currency fluctuations, and monitoring global policies and adopting lawful conduct every time it serves the client’s requirements. These are the elements that make them the most ethical and reliable source of financial guidance.

There are 36 commercial banks, 492 rural banks, 57 thrift banksThrift BanksA thrift bank, also known as a savings and loan association, is a form of a financial institution that provides basic banking services by offering a variety of savings options and mortgage loan services. Like commercial banks, these also qualify as depository institutions and may even offer a range of other products and services.read more, 40 credit unions, and around 6000 plus non-banking institutions. To control and direct these banks, the Bangko Sentral ng Philipinas was established. In July 1993, this central authority was founded. It was created as per the Philippine Constitution, 1987, and the New Central Bank Act, 1993. The Bangko Sentral ng Pilipinas was established to regulate all the banks and also help these banks inform the right policies.

As per Moody’s analytics, the Philippines’ banking sector is looking quite positive. The most important factor for which Moody’s analytics has been very positive about the banking sector of the Philippines is the way the central bank of the Philippines has curbed the effect of inflation over the years. Investment banking industry is expected to generate a revenue worth $1.31 billion in 2024 with an annual growth rate of 1.76%, amounting to a total of $1.22 billion by 2028.

Services

Investment banking in the Philippines offers a range of services to their eminent customers.

Let’s look at the most significant services these investment banks provide –

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M&A Advisory

A merger or acquisition is an opportunity to expand its horizon for a company that looks to grow. Investment banking in the Philippines offers that room and assistance for any corporation to expand through public takeovers, cross-border deals, or joint venturesJoint VenturesA joint venture is a commercial arrangement between two or more parties in which the parties pool their assets with the goal of performing a specific task, and each party has joint ownership of the entity and is accountable for the costs, losses, or profits that arise out of the venture.read more at an international level.

Debts & Equity Capital Markets Financing

Investors don’t always know which trends can help them make more money or prevent them from making more profits. Investment banks in the Philippines understand the intricacies of the debt and capital marketsCapital MarketsA capital market is a place where buyers and sellers interact and trade financial securities such as debentures, stocks, debt instruments, bonds, and derivative instruments such as futures, options, swaps, and exchange-traded funds (ETFs). There are two kinds of markets: primary markets and secondary markets.read more. So they help their clients spot the trends, help them understand the nitty-gritty of the global market, and let them make smart moves around their investments.

Bespoke Financing

Through bespoke financing, the investment banks in the Philippines help their clients understand the need for the right financing. For example, the company may look for structured financing, leveraged, or specialized financing.

Investment Research

This is another most important service offered by investment banks in the Philippines. In doing the research for their clients’ investment banks in the Philippines use quantitative analysis, statistical modeling, and data science.

Top Investment Banks

Here is the list of top investment banks in the Philippines –

  • ABCapitalOnline.com, Inc.
  • Asian Alliance Investment Corporation
  • Asian Focus Group Inc.
  • BPI Capital Corporation
  • Eastgate Capital Partners, Inc.
  • First Abacus Financial Holdings Corporation
  • First Metro Investment Corporation
  • FSG Capital Inc.
  • Insular Investment & Trust Corporation
  • Investment & Capital Corporation of the Philippines
  • Mabuhay Capital Corporation, Inc.
  • Medco Holdings, Incorporated
  • Navarro Amper & Co
  • PNB Capital and Investment Corporation
  • Punongbayan & Araullo
  • SB Capital Investment Corporation
  • Unioil Resources & Holdings Company, Inc

Recruitment Process

The investment banking career is quite lucrative for any finance professional. However, unlike the other investment banks in various countries, alot of emphasis is given to work-life balance. Therefore, the best way to approach an investment banking career in the Philippines is to go for an internship with the top investment banks there and then learn the way up to becoming an associate.

A few things that one needs to look for while applying for an investment banking career are –

  • How the investment banking firm approaches experience and how much professional growth one may get while pursuing their career in that particular investment bank.
  • Whether there is any paid training offered or not.
  • The investment bank provides any life insurance, health benefits, and retirement plan.
  • Whether there is an option for paternity or maternity leaves available if required soon.

The most important thing to consider is how well one connects the career growth with their family goals. Since in the Philippines, one of the most important aspects is family, having a good work-life balance is what every professional desires.

Culture

In an investment banking career, culture plays a big role. That’s why in the Philippines, the investment banking career is approached completely differently. Since most of the banks in the Philippines are foreign banks, in investment banks, one would see a mix and match of a foreign culture. The work ethic is very strong, and investment banking professionals work hard, around 80 hours to 100 hours.

Investment banking professionals also value heritage and tradition. That’s why balancing both work and spending time with family is considered most important.

Salaries

The Philippines is famous for getting cheap labor. However, the most unfortunate thing about an investment banking career in the Philippines is that the compensation of an investment banking professional is way too low.

The median compensation in an investment banking firm is PHP 353,749. While the investment banking professionals are raking in millions in the US and Europe, the investment banking professionals in the Philippines earn around USD 6000 in a year for under ten years of experience.

If one works their way up and can become a partner in a top-notch investment bank, they may earn a lot more, though.

Here’s a chart created by PayScale that might be helpful –

Investment-Banking-in-Philippines-chart

source: payscale.com

Exit Opportunities

An investment banking careerInvestment Banking CareerAn investment banking personnel is a motivated professional who aims to help their clients reach their financial goals and objectives. The top four investment banking careers are - Analyst, Associate, Vice president, Managing director. read more is normally seen lucrative to people for ten years or less. After that period, most of them begin searching for another options. The possible options  that a finance professional can choose when exiting the investment banking sector include corporate finance careerCorporate Finance CareerFinancial analyst, cost analyst, credit manager, cash manager, and benefits officer are some of the most popular career paths in Corporate Finance.read more, careers in commercial bankingCareers In Commercial BankingThe risk parity approach is a method of portfolio creation, the amount invested in various assets in the portfolio is determined based on the quantum of risk that security brings to the portfolio to ensure that each asset contributes equally to the portfolio's overall risk.read more, or starting one’s own business.

Since banking in the Philippines is huge and well-controlled, commercial bankingCommercial BankingA commercial bank refers to a financial institution that provides various financial solutions to the individual customers or small business clients. It facilitates bank deposits, locker service, loans, checking accounts, and different financial products like savings accounts, bank overdrafts, and certificates of deposits.read more is always a viable exit route. Besides that, one may choose to enter the private equity market, hedge fund and asset management niches, venture capital career, startups/entrepreneurships. The only difference that exists between investment banking and these other industries is that the former is about advising and guiding others, while most of the rest options come with the implementation part and doing it on their own.

This has been a guide to Investment Banking In Philippines. We explain its services, recruitment process & exit opportunities & list top investment banks. You may learn more about investment banking from the following articles –

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