Here in our country, we have so many banks--universal banks, commercial banks, savings banks, thrift/rural savings bank, development or even agri-business banks. There are so many categories. What's ironic, most of the big or universal banks like BPI, Metrobank or Banco de Oro have all kinds of banks. These banks also have high visibility in the major cities.
Our banks, in my opinion, are in a "dog eats dog" thing. The strong and big banks do not help the small banks to survive. The small or new banks have slim chance of survival. These giant, depositor- hungry banks would rather buy or take over a weaker bank. They don't think of the employees who will be affected. The top executives only think of the bigger share of the pie they will get. Where is the moral responsibility to the constituents--the employees, the depositors and others? It has become a survival of the fittest.
27 comments:
It is rather depressing to hear such scenario in the banking domain. Yes it is true that banking, like any other industry have to earn in order to stay in the field but it should not in any way come at the expense of its worforce and industry neophytes. They have to safeguard the interests of its stakeholders which include its employees.They have to understand that these people also have mouths to feed and personal needs to address. I think it is high time that these companies rectify their supposed flaws. It is a long, hard process but it has to begin NOW!!!
The banking system here in the Philippines is much like other industries / organizations in the country. They follow the rule of "survival of the fittest" and from that standpoint I feel that they have the right to do so. However, we can't really say that this principle is indeed "correct" or "ethical". I for one, am not a huge fan of the principle. An alternative to this would be an equal collaboration / interactivity between the main and sub-branches. For example, there would be similar wages among all employees and various plans for them. That way no moral or ethical principles are affected in the process.
I heard that central bank does not give out "branch permits" anymore that's why other banks have no choice but to merge with other banks so that they can keep their banking business alive. Because if their banks won't have more branches, their banking business will be stagnant, and being stagnant is a dangerous risk because their status can never be better but it can be worse anytime.
Bare, Katrina Shamile L.
OrgMgnt s21
in the Phil., people still have this crab mentality thing going on... as you've said, instead of helping other small banks, they just merge it with them or buy them, to make their assets bigger... it's just so sad that in a business (especially big companies) they are very selfish, they want everything for themselves...^^
There are no morals in a "dog eats dog" situation. I'm not at all familiar with how banks here in our country are faring, but if an opinion must be given...There are strong and big banks. Not just one, but several. If one deviates and don't do as the others do, that is, to buy or take over weaker banks, isn't there a chance that one day the bank will find itself as one of those 'weaker banks'? They'll be the dog to be eaten, not the one to eat. There is also more certainty in buying or taking over a weaker bank than merely helping it. While it may be true that top executives are the ones getting the most benefits, they are also thinking of the best measures in order to maintain/improve their banks' current standing. A single mistake can very well make the difference between 'big' and 'small' banks and what then of their own employees?
egocentrism. That would best describe any similar business schemes that this country has. Well, I think this applies too, with the other businesses in other countries. Instead of the possible help they could give/offer to the weaker organizations, they take advantage of their title as "Giant" organizations. They use their power, fame, and money to buy the weaker ones. Wouldn't it be more fulfilling to help the weaker ones than buying them and taking advantage out of it? Is it their concept and belief in widening out and expanding their "territories"? What impressions would be created in the minds of the younger generation who would like to start out their own businesses? There are really a lot of things to consider. Yet these giants should primarily be concered and be sensitive to the needs, sentiments, and concerns of the weaker ones. Next thing we know, only one bank runs in the Philippines. Moreover, the bank names of the weaker ones could only be seen as extension names of the giant bank. That would be a long organization name.
Well in my opinion, the big and strong banks really dont give consideration to small banks. Maybe what they are doing is unethical but to some executives as long as their banks continue to have more depositors meaning more income coming in the banks they have no problem. They prefer that small banks be bankrupt so they will have a chance to buy it to increase their assets. In that way, bank competition will be lessen.
I think this is whats happening in a lot of industries around the country... Which is quite bad.
Example are the gasoline industry, its dominated by the Big 3, Shell, Caltex and Petron. Which is bad news for new and upcoming gasoline franchises. I heard FilOil is offering some kind of environment friendly gasoline but nobody knows about that because of V-POWER and DIESELMAX or something like that.
Another is the coffee industry, Everybody has the misconception that you have to pay A LOT for a decent cup of Coffee these days. Starbucks and Seattle's are just a few who capitalize on this. But in reality, coffee isnt that expensive, you can buy a cup of Fine Brewed Coffee for as low as P15! I read about it in a magazine, its a coffee shop around alabang, quality coffee for everybody. Its mission its nice but franchises like starbucks is just monopolizing the industry
btw that was made by
Ollero, Job Reudan A. - S21
aljan ciruela
orgmgnt
I dont think that businesses or banks need to help each other out, first of all, for me, a bank should be somewhat a symbol of stability and reliability, a place whare you can run to when you need money. If they cant sustain themselves, then they dont deserve to hold peoples hard earned money..
vinno pacia
orgmgnt s21
cs - ist
well.. earlier i left a comment on "bank merges and buyouts" i just read this post and it is somewhat related to what i said in my comment in the other post about the survival of the fittest thing.. as i said in the comment on the previous post that for me its a good thing that these people really fight to survive. i mean what do you have to do if you are a bank and there's this other bank who is a tough competitor, of course you're in trouble of losing clients and how do you expect to earn/grow without people depositing their money to you. of course you have to do better than that other bank, you can try to buy or merge with them so that you could become a stronger team right. and its all gonna have both good and bad effects maybe major or minor, it doesnt really matter. for the people who will lose their jobs because of merging our buyouts you should expect that they could survive, that they could find a way to earn money because i think every human being has the instinct that every animal on this planet have. and that is to survive on its own
I honestly don’t know anything about the banking system here in the Philippines. Well with the situation presented, I don’t think there’s anything wrong with it. Normally if you’re the owner, you’ll think of strategies and ways to improve your bank. Basically that’s all you need to think of. These big banks have started small just like those “smaller” banks that are controlled by bigger banks. All the banks will go through the same process and its rate of growing depends primarily on how well the bank is going to be managed. It’s a matter of how well these smaller banks make their decisions to improve themselves. I’m not sure of the benefits that bigger banks get with merging with weaker banks, but I guess it’s something very advantageous and with this I don’t think you would even bother to consider what to do with the employees of the weaker bank. It comes after the merging process and I guess if the bigger banks find these employees useless then they won’t be hesitant to take their jobs. With regards to their depositors, who wouldn’t want to deposit in a bank where they normally deposit? or somewhere near their place that merged with a bigger bank? it would be more favorable for the depositors. It gives more assurance. so i think it's just normal... it seems to be very selfish but i guess it's how it really works- karla tan
Hearing this scenario, I only hope that the government will be able to prevent monopoly even in the banking industry.
Although I doubt that.
~tori
ermilo john d. gialogo, jr. |
orgmgnt s21
I am not depressed in such takeovers. For me this is one of the ways to save smaller banks, and also takeovers will not be possible if the management of a small bank can make good use of the investments they have. It is better that big banks take over small banks simply because with this mentality in mind, these small banks will now strive to survive so that they wouldn't have to submit to the bigger banks.
Ngo, Mary Ann
as i've stated in my comment on the previous post, i don't really have anything against mergers and buyouts. :) from a business perspective, i think that these things are inherently part of the business process that characterizes capitalism. :) in the same way that shopping malls threaten some local industries and sari-sari stores, big banks threaten the prosperity and the very existence of smaller and startup banks. :)
however, today's business ethos has evolved from the old, straightforward business goal of securing "maximum prosperity for the employer and the employee," regardless of the people and interests that will be affected, into something that places a lot more emphasis and importance on ethics and values. :) it is virtually a universally accepted fact (at least among the more upright people), that enriching the few at the expense of many is never "good" or "right." :) consequently, whereas taking over or buying a weaker bank naturally brings about certain advantages and gains for a specific group of people, it may also mean depriving another group of people of their sole source of livelihood or, in extreme cases, robbing clients of their retirement savings. :) it may also spell disaster for some investors and shareholders, or disregard for the human rights of the employees. :) all of these point to the conclusion that taking over weaker banks is unethical and should be done away with. :)
truth be told, however, i would not advocate the prohibition of such practices or even the punishment of the perpetrators (the big banks). :) i believe that the correct response varies from situation to situation, and that as long as a buyout doesn't happen solely to serve the greedy, it is not entirely immoral or unethical. :)
Philip Balboa S18 ORGMGNT
I believe, all companies including banks have the desire to grow, increase their profit and expand their business and that's just normal. How could they possibly do all that? Increase their market share by putting up branches, however this requires time, organiztion and money whereas buying out smaller banks that have already branches only requires money. Building their own branches will take some time and lose valuable opportunities for profit while on the other hand buying out small banks allow it to operate the moment it acquires them thus saving time and money.
Both seller and buyer have the responsibility to the employees that are affected by the said "take over". Most buyers retain the rank and file employees while some of the officers will be forced to have their early retirement. It's the responsibility of the seller to make sure that their officers be given their proper benefits especially those who are above 40 years of age because they will have a hard time looking for a new job(in that case atleast they'll have money to start their own business), I think they follow a certain formula on how much one employee should receive according to how long s/he had worked for the company.
Philip Balboa S18 ORGMGNT
I believe, all companies including banks have the desire to grow, increase their profit and expand their business and that's just normal. How could they possibly do all that? Increase their market share by putting up branches, however this requires time, organiztion and money whereas buying out smaller banks that have already branches only requires money. Building their own branches will take some time and lose valuable opportunities for profit while on the other hand buying out small banks allow it to operate the moment it acquires them thus saving time and money.
Both seller and buyer have the responsibility to the employees that are affected by the said "take over". Most buyers retain the rank and file employees while some of the officers will be forced to have their early retirement. It's the responsibility of the seller to make sure that their officers be given their proper benefits especially those who are above 40 years of age because they will have a hard time looking for a new job(in that case atleast they'll have money to start their own business), I think they follow a certain formula on how much one employee should receive according to how long s/he had worked for the company.
sorry for the double posts.. internet is so slow
Miguel Cabral
ORGMGNT S18
Merging is not only common in the banking industry but in other businesses as well. For me merging is the "growth" of one company at the expense of another. The company that buys out the smaller/weaker company may gain more, but a lot of people will have suffer just for that. The ones that are usually affected are the employees of the company that was bought, a lot of these employees are in the danger of losing their jobs. A better alternative would be retaining these employees, since the company will grow upon acquisition they will be needing more manpower, and the employees of the smaller company could provide that.
given the state of the economy in our country today, it doesn't surprise me that it has become a "dog eats dog" world, just like most of the businesses out there. Maybe when it comes to the banking industry it's more noticeable than others because of the sheer volume of banks in our country. But having a survival of the fittest kind of situation may not be as bad as it sounds since it may also bring out the best in these banks since they are forced to outdo each other in order to survive thus giving us (the customers) a better field of choices when it comes to our banking options.
Aliento, Juno
ORGMGNT s18
Morally and ethically wrong, agree. But that's how it really works in the industry. For me, it's just a fair competition.
In the world of warriors, what's the best way for you to get rid off your enemies (competitors), you kill them. Warriors, back then, equate their ranks by the number of enemies they have killed in a battle. Rank means strength and stability. The stronger you are the more people opt to believe in you.
This system also works with merging companies. Not only does it earns the respect of the other banks, it also earns the trust of the investors as well as the depositors.
In our country, this types of activity is not a very unusual thing, we are seldom concern with such things that happens to smallers banks. We also find it hard to support such banks due to risk that we will inherit.
Jeff Esperanza
I would say that they should play fair with the small banks... I think that for them to be competitive with all of the banks, they should have a different division to compete with the small banks, another one for the big fishes, and so on... They must make sure that each entity would act independently of each other, so that the smaller entity would not be influenced by the decisions of the higher ones... In this set-up, there would be even competition, and that the smaller banks would have a fair chance to face competition, one level at a time...
I think that our banking system here in the Philippines is not different from other companies and industries here and in other countries. There are many big and strong banks who would buy or merge with other banks. And i think it is for them to increase their assets and for them to have stronger chances to survive in the industry. But isn't it unethical? Because many employees who work for those smaller banks lost their jobs. Maybe some of them were employed by the new banking company but still, many lost their jobs. But i can't blame them for doing that because they might have other important reasons why they buy or merge with other banks.
Kirk Ilagan
ORGMGNT S18
For me, this "business takeover" is not an odd situation anymore. Given the fact that a lot of small banks had close before due to their debts, banking institutions like Metrobank and BPI took them over for some reason. I think that this is quite or somewhat beneficial to both of them because small banks can still survive, while the big ones expand their institutions.
As for the problem for the employees on the smaller banks, well, I think that they should be always prepared when they will have to quit their jobs. I think that when a "takeover" does happen, this may also mean that their company is on a loss, thus, there is no point to them to continue working there when they cannot be paid properly. But, if their company still needs them and can sustain them,then that's a good news to them...
However, I still believe that some takeovers are not necessary if the smaller banks can still serve their customers at its best. There should be an organization that will check whether a small banking institution is still able to run their bank properly or not. This institution should also check the bigger banks whether the takeover will be both beneficial to them and the other one. This will prevent the greediness and monopolization of the bigger ones and in the same time, making higher chances of survival for the small ones.
Dino Z. Flores
ORGMGT S18
“Business cannot live alone. “ They absolutely need customers. In the same way, in order to be called “giants”, they need scores of customers to patronize them. My point is that we cannot just blame those giant businesses alone who eat weaker businesses. Let us remember that reason why those giants become where they are right now is the fact that we continuously patronize them. I don’t mean to say that we should not patronize them, but my main point is that we should support other “weaker” banks as well the way we support those giants. I just want to erase those “giants” or “weaker” adjectives in banks. I believe that they are all equal and must given equal importance. I strongly believe that business cannot eat other business if they are equal.
For us, the customers, maybe it is a hard thing to trust those so called “weaker” banks. But I think we should give them chances by putting not all of our wealth but maybe part of it. So that in case the business gets bankrupted, we just lose part of it and not the entire. The same way with “giants” bank, although they are called giants, it does not mean that they are exempted from bankruptcy. They can still be a candidate. So it is better for us to trust not all of our money to them.
The idea is to have several banks handle our wealth. I know it is hard to track that way, but it is much harder and risky to have a single bank than can take away all our wealth once their business got broke.
Let us remember that we cannot ELIMINATE competition among business but we can LESSEN them.
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