Offshore Banks in the Philippines

Updated October 2, 2021

What Do Offshore Banks in the Philippines Do?

Offshore Banks do foreign-currency banking transactions primarily with non-residents, foreign banks, other offshore banks and corporate and institutional clients. They offer project finance, export financing, global trade financing and other international trade loans. They can be branches, subsidiaries, or affiliates of foreign banks authorized to do offshore banking in the Philippines.

Offshore banks can lend to resident importers and exporters only if the funds are remitted from abroad through the banking system.

They can open peso deposit accounts with Philippine banks but these accounts should only be used to meet administrative and operating expenses and to pay local beneficiaries or recipients of non-resident-company remittances coursed through the offshore banks’ correspondent banks abroad.

Taiwan Cooperative Bank
26th Floor, BDO Towers Valero
8741 Paseo de Roxas Ave.
Makati City
No. of Offices: 1
Phone: 8-8481949 | 8-8481959
Website: Taiwan Cooperative Bank

Taiwan Cooperative Bank (TCB) is Taiwan’s 3rd biggest bank, with 295 domestic and overseas branches as of December 31, 2020. In The Banker magazine’s ranking of global banking brands in 2021, TCB ranked 256th in the world.

For the fiscal year 2019, TCB had total assets of 3.5 trillion NT dollars and  15.996 billion NT dollars in net income. It had 2.898 trillion in deposits, which ranked second in Taiwan.

It has 8 banking branches in Cambodia, 5 branches and 1 representative office in China, 3 branches in the USA, 2 in Australia, 1 banking subsidiary in Belgium, 1 branch in Hong Kong, 1 branch in Laos, and 1 representative office in Myanmar.

Taxation of Offshore Banks in the Philippines

Previously, under the Tax Code, offshore banks were exempted from paying tax for income earned from foreign currency transactions with non-residents. What was taxed (10% withholding tax) was income earned from foreign currency loans granted to residents.

Under Republic Act No. 11534 or the Corporate Recovery and Tax Incentives for Enterprises (“CREATE”) Act that took effect on April 11, 2021, the tax exemption previously granted was removed.

Now, offshore banks are being taxed at 25% of taxable income.

Offshore Banks in the Philippines that Ceased Operations in Recent Years

The offshore banking unit that left the Philippines in 2019 was the French international bank BNP Paribas. Its closure was noted by the BSP in its Circular Letter No. 2019-062, signed August 20, 2019. According to BNP Paribas, it started operating in the Philippines in 1975.

BNP Paribas
Former office address:
30th Floor, Philamlife Tower
8767 Paseo de Roxas Avenue
Makati City 1226
No. of Offices: 1
Website: bnpparibas.com.ph

According to its website, BNP Paribas offered:
. export finance
. loan syndication
. bond underwriting
. project finance
. aviation finance
. correspondent banking
. global trade banking
. interest rate, foreign currency and commodity hedging and derivatives

There was also another offshore bank that ceased operations in 2018:
J.P. Morgan International Finance, Ltd. stopped its operations as an offshore banking unit in the Philippines on February 22, 2018, as noted by the BSP in a circular letter in 2018.

Former office address:
30th Floor, Zuellig Building
Makati Avenue corner Paseo de Roxas
Makati City 1225
No. of Offices: 1
Phone: 885-7925

List of Foreign Banks in the Philippines 
Representative Offices in the Philippines