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DBP STRATEGIC THRUSTS AND DIRECTIONS FOR THE MEDIUM TERM 2011-2016

STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS

STRENGTHS
Development Mandate
Expertise in financing development projects Access to ODA facilities Competent, well-trained and motivated officers and staff Strong management Serves as major bank of government agencies; duopoly of government deposits Ability to secure deals thru government networks Recognized with awards from various institutions Strong balance sheet Industry high CAR

Human Resources

Brand and Connections

Financial Stability

WEAKNESSES

Constraints in Structure, Mandate and Business Model

Limited branch network and infrastructure Development mandate may temper returns on lending activities High dependency on ODAs resulting in higher cost of funds Thinning margins Deposit base is limited and is not diversified; high dependency on government deposits Credit concentration high among the thirty biggest borrowers

OPPORTUNITIES
Strategic Thrusts Aligned with National Thrusts
Administrations development thrusts are also DBPs thrusts (infrastructure, logistics, MSMEs, social services, and environment) Launch of Governments Public Private Partnership program, with DBP as financial advisor, gives the Bank a head start in PPP infrastructure financing

Investment Banking/Capital Market Development

IPOs, trade credits, investment banking particularly issuance of bonds Bank can offer high net worth individuals with array of investment outlets Equity investments and fixed income trading opportunities

OPPORTUNITIES
Increase in number of branches can generate more deposits, especially in the private sector Government property procurement and building acquisition programs Possible merger with Land Bank can transform DBP into a bigger player

Expansion

Continuous Organizational Development

Early Retirement Incentives Package facilitates career growth of promising personnel and allows the Bank the opportunity to infuse fresh blood Completion of Information Systems Strategic Plan (ISSP) modernizes the Banks operations and makes it more competitive and efficient

THREATS
Effects of National Policy Actions
Possible loss of duopoly over government deposits because of bill seeking to allow private banks become government depositaries Possible merger of DBP and Land Bank; reorganization may have impact on security of tenure, benefits and compensation
Low interest rate and high liquidity regime Active bond market tends to crowd out borrowing Low demand for loans, especially in project financing Demand for increase in dividends vs. need to comply with Basel accord

Market Environment and Regulatory Requirements

THREATS

Business Continuity

Early Retirement Incentives Package to result in loss of key personnel, expertise and institutional knowledge especially in senior positions Discontinuity in decision-making especially in Bank committees and subsidiaries Limited bench; no institutionalized talent pool