Bank of America Corp. (BA), the second-largest US-based financial holding company with global assets of $2.13 trillion, has directly outsourced its business support activities to the Philippines via a newly formed non-bank subsidiary.
This is according to House Deputy Majority Leader Roman Romulo, who cited the American banking giant’s move to transfer selected non-core business functions to Manila.
“The Philippines has secured its place as the world’s fastest-growing outsourcing hub, and the preferred offshore site of US-based global corporations when it comes to labor-intensive and information technology-enabled services,” Romulo said.
“With BA already in, our BPO sector will hopefully achieve if not surpass its target to produce 126,000 new jobs and generate $2 billion in extra revenues this year,” said Romulo, also vice chairman of the House committee on information and communications technology.
Charlotte, North Carolina-based BA is the last of the Big Four American banks to relocate business support services to the Philippines.
JPMorgan Chase & Co. ($2.3 trillion in assets) and Citigroup Inc. ($1.87 trillion in assets) have long-existing back offices in Manila under JPMorgan Chase Bank -Philippine Global Service Center and Citigroup Business Process Solutions.
Wells Fargo & Co. ($1.33 trillion in assets) recently put up Wells Fargo Philippines Solutions Inc.
Romulo is author of the proposed Data Privacy Act, which is expected to further drive outsourcing to Manila.
Already passed by the House and the Senate, the bill will undergo bicameral conference committee finishing touches before it is sent to Malacanang for President Aquino’s signature.
The measure mandates both public and private entities, such as a BPO company, to protect the integrity and confidentiality of any personal information collected from their clients, in compliance with international privacy standards.
Romulo said BA has established a wholly-owned non-bank subsidiary, BA Continuum Philippines Inc., to execute the bank’s business support operations in Manila.
The firm will carry out back-office transactions, customer support, technology services, human resource management, and business planning, among other tasks.
BA Continuum has just launched a recruitment base at Bonifacio One Technology Tower in Taguig City.
The firm is enlisting college graduates in any field who are willing to perform night shift jobs, with preference for candidates specializing in banking/financial services.
The BPO industry is projected to produce $25 billion in revenues and fully engage some 1.3 million Filipino workers by 2016.
With a labor force of 630,000, the sector posted $11 billion in revenues in 2011, according to the Business Processing Association of the Philippines.
Founded in 1904, BA operates in more than 40 countries and has over 282,000 employees. It provides a full range of banking, investing, asset management and other financial and risk management products and services.
In the US alone, BA has 57 million customers (including 30 million active online banking users), 5,700 branches and 17,250 ATMs.
BA’s $957-billion worth of US deposits accounted for 11 percent of all US bank deposits as of Dec. 31, 2011.
At the height of 2008 global financial crisis, BA was among the American banks considered “too big to fail.”
US government capital injections and loans propped up BA, and enabled it to absorb Merrill Lynch & Co. and Countrywide Financial Corp., which were also staggering under the weight of financial losses due to the housing crisis.
BA’s decision to shift jobs to Manila comes amid worries in the Philippines over a US anti-outsourcing bill.
The proposed US Call Center and Consumer Protection Act, introduced by New York Rep. Tim Bishop, would require the US Department of Labor to track firms that shift contact center jobs overseas.
The firms would then be ineligible for any direct or indirect US federal loans or loan guarantees for five years. The bill would also require contact center staff to disclose their location to US consumers, who would be given the right to be routed to a US-based call hub upon request.