development mindset powered by

strengthening a

governance

PGS Initiation Stage Revalida Presentation

30 March 2012, Public Governance Forum

5
4 3 2

development mindset

strengthening a

development and

governance

organizations core
CORE VALUES
Integrity Love for the Filipino Excellence Teamwork Service to others

MANAGEMENT PHILOSOPHY
Participative Management Good Governance Transparency People Development

MSMEs

Social Sector

Infrastructure and logistics

Environment

MSMEs

Social Sector

MISSION STATEMENT
We will work for raising the level of competitiveness of the economy for sustainable growth. We will support infrastructure development, responsible entrepreneurship, efficient social services and protection of the environment. We will promote and maintain the highest standards of service and corporate governance

Infrastructure and logistics

Environment

65
PRE-DBP
Govt trust fund

ENABLING PARTNERSHIPS FOR DEVELOPMENT

1947 Rehabilitation Finance Corp 1986 Clearing of books 2009 New logo for innovation 2012 Pioneer in corporate governance

1935 National Loan and Investment Board

Transfer of nonperforming assets

START

EXPAND
1958 Reorganized into DBP Expansion of network of branches

RESTART

INNOVATIVE GROWTH & GOOD GOVERNANCE

P4.02B highest ever core net income 2011

1939 Agricultural and Industrial Bank

1995 Universal banking status

SERVICES OFFERED

Credit facilities

Branch Banking

Countryside Finance

Lending: housing, SMEs and agri

Mortgage loan, secured and unsecured loans

Investment banking, sales, merchant, trading and research

65
PRE-DBP
Govt trust fund

ENABLING PARTNERSHIPS FOR DEVELOPMENT

1947 Rehabilitation Finance Corp 1986 Clearing of books 2009 New logo for innovation 2012 Pioneer in corporate governance

1935 National Loan and Investment Board

Transfer of nonperforming assets

START

EXPAND
1958 Reorganized into DBP Expansion of network of branches

RESTART

INNOVATIVE GROWTH & GOOD GOVERNANCE

P4.02B highest ever core net income 2011 2016

1939 Agricultural and Industrial Bank

1995 Universal banking status

SERVICES OFFERED

Where is DBP headed from 2011 to 2016?

Mortgage loan, secured and unsecured loans Investment banking, sales, merchant, trading and research

Credit facilities

Branch Banking

Countryside Finance

Lending: housing, SMEs and agri

Ang bagong mukha ng kaunlaran

VISION STATEMENT

By 2016, a globally-recognized development financial institution, serving as a catalyst for a progressive and poverty-free Philippines

DBP Board Meeting

Infrastructure, logistics and PPP thrust of the Aquino Administration

Generation of private sector deposits + OFW remittances Branch expansion

Development lending activities with low returns Losing of duopoly over government deposits High cost producer with limited branch network Impending ERIP

Competent, well-trained and motivated officers and staff

DEVELOPMENT BANK OF THE PHILIPPINES STRATEGY MAP 2016

A globally-recognized development financial institution, serving as a catalyst for a progressive and poverty-free Philippines
-We will work for raising the level of competitiveness of the economy for sustainable growth -We will support infrastructure development, responsible entrepreneurship, efficient social services and protection of the environment -We will promote and maintain the highest standards of service and corporate governance.

MISSION

MGT PHILOSOPHY
-Participative Management -Good Governance -Transparency -People Development -Integrity -Love for the Filipino -Excellence -Teamwork -Service to others

CORE VALUES

DEVELOPMENT BANK OF THE PHILIPPINES STRATEGY MAP 2016

A globally-recognized development financial institution, serving as a catalyst for a progressive and poverty-free Philippines
-We will work for raising the level of competitiveness of the economy for sustainable growth -We will support infrastructure development, responsible entrepreneurship, efficient social services and protection of the environment -We will promote and maintain the highest standards of service and corporate governance.

MISSION

Who are our stakeholders and how can they benefit from our services?

SOCIAL IMPACT

How do we improve our fund sourcing and management?

FINANCE

CONSTITUENCY
How do we intensify funding for priority areas? What are we doing to be globally recognized?

INTERNAL PROCESS
What corporate governance practices should we implement to achieve breakthrough results, comply with internal and external regulatory requirements and strengthen bank operations?

MGT PHILOSOPHY
-Participative Management -Good Governance -Transparency -People Development -Integrity -Love for the Filipino -Excellence -Teamwork -Service to others

ORGANIZATION
How can we acquire, develop and harness the skills and talent of our people to attain our vision? Do we have sufficient organizational development initiatives to pursue our mandate and grow? Are we providing the direction to our people to think developmental?

CORE VALUES

DEVELOPMENT BANK OF THE PHILIPPINES STRATEGY MAP 2016

A globally-recognized development financial institution, serving as a catalyst for a progressive and poverty-free Philippines

Social Impact

Finance

Constituency Internal Process

Implement a structure for a learning & peak-performing organization.

Organization

Recruit and retain the best and the brightest

Improve training programs for head office and branch.

Update and align PMS toward a balanced and efficient operations

Institutionalize a succession plan and talent management

GOVERNANCE SCORECARD
PGS INITIATION STAGE REVALIDA
Strategic Objectives
E. Implement a structure for a learning and peak-performing organization D. Institutionalize a succession plan and talent management C. Update and align PMS toward a balanced and efficient operations B. Improve training programs for head office and branch A. Recruit and retain the best and the brightest

organization
2012 Targets 2016 Targets
80%:20%

Measures
E5. % of home-grown to external hires
D4. % of critical positions with a succession plan C3. % of performance management system aligned to the strategy B2. % of T&D cost to total people cost

Initiatives
I10. Provide training as determined by the TNA and provide technology support I9. Hiring program to meet targets and competency requirements I8. Maintain adequate pool of qualified candidates I7.Establish a succession planning system for all key positions below the President up to AVP level I6. Update the PMS and align to vision and mission of the Bank I5. Conduct priority training as determined by TNA I4. Review training needs and updated T&D programs to meet the 5% I3. Engage third party for competitiveness in compensation I2. Conduct image and reputation survey, CSR/Environment policies I1. Enhance HR policies

80%:20%

100%

100%

100%

100%

2%

5%

A1. Ranking in reputation as an employer/ institution

Start survey

Upper 25%

DEVELOPMENT BANK OF THE PHILIPPINES STRATEGY MAP 2016

A globally-recognized development financial institution, serving as a catalyst for a progressive and poverty-free Philippines

Social Impact Finance Constituency Adopt responsive bank management & governance practices

Internal Process

Establish and utilize ICT as a management tool and enabler

Streamline credit and other operating processes

Carry out mandate of regulators in audit, risk mgt & compliance

Maintain good standing with regulatory bodies

Implement a structure for a learning & peak-performing org Recruit and retain the best and the brightest Improve training programs for head office and branch Update and align PMS toward a balanced and efficient operations Institutionalize a succession plan and talent management

Organization

GOVERNANCE SCORECARD
PGS INITIATION STAGE REVALIDA
Strategic Objectives
J. Adopt responsive bank management and governance practices I. Maintain good standing with regulatory bodies H. Carry out mandate of regulations in risk management and compliance

internal process
2012 Targets
Within 5 days from date of request Non-PCA status

Measures
J13. Time needed to consolidate and release financial and operating reports I12. Status with regulatory bodies

2016 Targets
Within 5 days from date of request Non-PCA status Maintain or improve Best practice (%) Best practice (%) 1% 100% 100 new from 11-16

Initiatives
I20. Maintain, if not improve, timeliness, accuracy, reliability and relevance of financial and operating reports I19. Address all issues raised and prevent recurrent, establish policies where need (esp. policy on whistle blowing) I18. Banking best practice on areas for improvement I17. Review standards and monitoring systems I16. Identify delays in loan releases and correct I15. Review policies needing updating I14. Make NPL Performance relate to PMS and strengthen monitoring system I13. Implement remaining major projects based on the 2011 ISSP I12. Identify appropriate locations I11. Sustain responsiveness and usefulness of site

H11. CAMELS Rating G10. % backlog in loan applications

4 Best practice (%) Best practice (%) 2.98% 100% 30 new

G. Streamline credit and other operating process

G9. % of approved loans released G8. NPL to total loans

F. Establish and utilize ICT as a management tool and enabler

F7. % completion of major ISSP projects F6. Number of new offsite ATMs

DEVELOPMENT BANK OF THE PHILIPPINES STRATEGY MAP 2016

A globally-recognized development financial institution, serving as a catalyst for a progressive and poverty-free Philippines

Social Impact Finance

Constituency

Support government priority programs

Build recognition as a preferred partner of OFWs/investors

Adopt responsive bank management & governance practices

Internal Process

Establish and utilize ICT as a management tool and enabler

Streamline credit and other operating processes

Carry out mandate of regulators in audit, risk mgt & compliance

Maintain good standing with regulatory bodies

Implement a structure for a learning & peak-performing organization.

Organization

Recruit and retain the best and the brightest

Improve training programs for head office and branch

Update and align PMS toward a balanced and efficient operations

Institutionalize a succession plan and talent management

GOVERNANCE SCORECARD
PGS INITIATION STAGE REVALIDA
Strategic Objectives Measures
L18. % of loan portfolio supporting government priority programs L. Support government priority programs

constituency
2012 Targets
90%

2016 Targets
70%

Initiatives
I41. Cooperative Anti-Lending Program Facility I40. Agribusiness Development Programs I39. Tree Plantation Financing Programs 37. Sustainable Shelter Devt Financing Program I36. Green Finance Program I35. Financing Program for the Sanitation Sector I34. Financing Program for the Water Sector I33. Connecting Rural Urban Intermodal System Efficiency (CRUISE) Program I32. Financing Program for Basic Education I23. Deliberate shift to development loans

L17. % composition of loan portfolio according to government priority programs

Infra 33.2% Env 6.2% SocS 15% MSME 15%

Infra 30% Env 10% SocS 15% MSME 15%

K16. % increase in volume of new remittances from 2011 (US% 127.5M) K. Build recognition as a preferred partner of OFWs/investors K15. Total number of new countries with DBPs presence

20%

100%

20 top countries 6 new tieups

25 top countries 6 new tieups

K14. Number of new MOA signed with international tie-ups per year

I38. DBP Overseas Filipino Workers Reintegration Program I22. Generate remittance volume from Overseas Filipinos and governmental/non-governmental organizations serving OFWs I21. Establish DBP presence in key countries hosting overseas Filipinos

DEVELOPMENT BANK OF THE PHILIPPINES STRATEGY MAP 2016

A globally-recognized development financial institution, serving as a catalyst for a progressive and poverty-free Philippines

Social Impact Improved balance sheet & credit rating

Finance
Constituency

Improved ODA funding and sourcing

Quality and balanced investment portfolio

Intensified deposit generation capabilities

Support government priority programs

Build recognition as a preferred partner of OFWs/investors

Adopt responsive bank management & governance practices

Internal Process

Establish and utilize ICT as a management tool and enabler

Streamline credit and other operating processes

Carry out mandate of regulators in audit, risk mgt & compliance

Maintain good standing with regulatory bodies

Implement a structure for a learning & peak-performing organization.

Organization

Recruit and retain the best and the brightest

Improve training programs for head office and branch

Update and align PMS toward a balanced and efficient operations

Institutionalize a succession plan and talent management

GOVERNANCE SCORECARD
PGS INITIATION STAGE REVALIDA
Strategic Objectives Measures
Industry ranking in: -Assets: -Loans -Deposits -CAR % growth rate in loan portfolio (loans to borrowers) from 2011 (P121.51B) Rates comparable to private commercial banks Total number of new branches

finance
2012 Targets 2016 Targets
Ranking: -Assets: 3 -Loans: 5 -Deposits: 5 -CAR: w/in Basel 3 100%

Initiatives
I25. New branches I29. Aggressive but prudent lending based on priorities I28. Raise new capital

P. Improved balance sheet and credit rating

Within top 10 commercial banks

O. Quality and balanced investment portfolio N. Improved ODA funding and sourcing

29.7%

I6. Update the PMS and align to vision and mission of the Bank I27. Reduce cost of funds I26. Renegotiate sources of funds I25. Increase number of branches I26. Identify growth areas that can absorb new branches and recruit quality personnel I25. Increase branches, empower branches with IT support, more new products, deposit campaigns, sales oriented organization I24 More branches, mine existing private accounts, review compensating business policy (market base)

Market rates 10 25% P137.21B

G: P182B (73.5%) P: P36.3B (26.5%)

Market rates 128

M. Intensified deposit generation capabilities

% growth rate of low cost deposit portfolio

Size of deposit base Composition of deposit base Govt/Private/ LGUs

P241.30B
50%/25%/ 25%

DEVELOPMENT BANK OF THE PHILIPPINES STRATEGY MAP 2016

A globally-recognized development financial institution, serving as a catalyst for a progressive and poverty-free Philippines

Social Impact
Finance

Expanded access to social services for Filipinos (health, education, livelihood, housing, employment)
Improved balance sheet & credit rating

Improved ODA funding and sourcing

Quality and balanced investment portfolio

Intensified deposit generation capabilities

Constituency

Support government priority programs

Build recognition as a preferred partner of OFWs/investors

Adopt responsive bank management & governance practices

Internal Process

Establish and utilize ICT as a management tool and enabler

Streamline credit and other operating processes

Carry out mandate of regulators in audit, risk mgt & compliance

Maintain good standing with regulatory bodies

Implement a structure for a learning & peak-performing organization.

Organization

Recruit and retain the best and the brightest

Improve training programs for head office and branch

Update and align PMS toward a balanced and efficient operations

Institutionalize a succession plan and talent management

GOVERNANCE SCORECARD
PGS INITIATION STAGE REVALIDA
Strategic Objectives Measures
Number of new development programs

social impact
2012 Targets
6 new programs per year

2016 Targets
6 new programs per year

Initiatives
I41. Cooperative Anti-Lending Program Facility I40. Agribusiness Development Programs I39. Tree Plantation Financing Programs I37. Sustainable Shelter Devt Financing Program I36. Green Finance Program I35. Financing Program for the Sanitation Sector I34. Financing Program for the Water Sector (498 waterless LGUs and 780 water districts) I32. Financing Program for Basic Education I31. Continuous assessment of development needs I30. Offer competitive rates I28. Raise new capital I26. Renegotiate sources of funds I25. Increase branches, empower branches with IT support, more new products, deposit campaigns, sales oriented organization I6. Update the PMS and align to vision and mission of the Bank

Q. Expanded access to social services for Filipinos (health, education, livelihood, employment, etc.)

Cut between developmental/ commercial; retail/ wholesale

D: 90% C: 10% R: 90% W: 10%

D: 95% C: 5% R: 75% W: 25%

DEVELOPMENT BANK OF THE PHILIPPINES STRATEGY MAP 2016

A globally-recognized development financial institution, serving as a catalyst for a progressive and poverty-free Philippines
-We will work for raising the level of competitiveness of the economy for sustainable growth -We will support infrastructure development, responsible entrepreneurship, efficient social services and protection of the environment -We will promote and maintain the highest standards of service and corporate governance.
Social Impact

MISSION

OPERATIONAL EXCELLENCE

DEVELOPMENTAL THRUST

Expanded access to social services for Filipinos (health, education, livelihood, housing, employment)

Improved balance sheet & credit rating

Finance

Improved ODA funding and sourcing

Quality and balanced investment portfolio

Intensified deposit generation capabilities

Constituency

Support government priority programs

Build recognition as a preferred partner of OFWs/investors

-Participative Management -Good Governance -Transparency -People Development

Int. Process

MGT PHILOSOPHY

Adopt responsive bank management & governance practices

Establish and utilize ICT as a management tool and enabler

Streamline credit and other operating processes

Carry out mandate of regulators in audit, risk mgt & compliance

Maintain good standing with regulatory bodies

-Integrity -Love for the Filipino -Excellence -Teamwork -Service to others

CORE VALUES
Organization
Recruit and retain the best and the brightest

Implement a structure for a learning & peak-performing org

Improve training programs for head office and branch

Update and align PMS toward a balanced and efficient operations

Institutionalize a succession plan and talent management

more meaningful alignment

Alignment in the Aquino administrations governance thrust of infra and PPPs

early gains
P4.35B in Environment

P24.79B in Infra and Log

P1.71B in Social Services

P142.83B loan releases in industrial and commercial enterprises

TRADITIONAL not just financial measures

NEW DBP balanced with impact

early gains
more meaningful numbers to measure performance
First time to include and identify social impact on DBP scorecard

Commitment not just on paper

development mindset powered by

strengthening a

governance

PGS Initiation Stage Revalida Presentation

30 March 2012, Public Governance Forum