Cover of Jobo Fernandez's authorized biography by Krip Yuson, courtesy of Lito Ligon

‘A bank is forever’: remember Far East Bank and Trust Co.?

June 16, 2024
8:48AM PHT
Updated: June 17, 2024
10:21AM PHT

For many of us, the existence of the Far East Bank and Trust Company – FEBTC or Far East Bank depending on the era – may already be a distant memory.

You might once have been a depositor. Or perhaps they extended you a loan for your business. Maybe you invested in the money market through their personal banking arm.

Whatever the case, let us look back on the history of Far East Bank which in 1999-2000 merged with the Bank of the Philippine Islands (BPI) in a mega deal.

Cover of Jobo Fernandez' authorized biography by Krip Yuson, courtesy of Lito Ligon

A man named Jobo

The start of Far East Bank traces back to Jose B. Fernandez Jr., better known as "Jobo". A Fordham alum and Harvard MBA, Jobo later served as Central Bank Governor from 1984 to 1990.

He was initially connected with the Philippine Bank of Commerce under founder Jose Cojuangco. After a decade of being the de facto person running PBC, Jobo decided to leave, driven by the desire to form and manage his own bank.

Unlike the predominantly family-owned banks of the time, Jobo envisioned a bank with diversified ownership and no single controlling shareholder group.

An auspicious start

SGV founder Washington "Wash" Sycip, a good friend of Jobo, encouraged him to pursue his vision, according to Jobo: The Life and Times of Jose B. Fernandez Jr. In 1958, during two plane rides from Tokyo to Manila and then Manila to Cebu, Wash and Jobo had lengthy discussions, with Wash affirming it was a risk worth taking.

For the needed start-up capital to bring his dream to life, Jobo approached Chinabank's Don Albino Sycip (Washington's father) for a loan which was immediately granted without collateral. 

From there, a formidable pool of founding investors followed suit: former Finance Secretary and Amon Trading founder Aurelio Montinola Sr., Senen Gabaldon, later of MERALCO, Leonides Virata who later became commerce secretary, Carlos Palanca Jr. of La Tondeña, Mariano Cacho Sr. of Cacho Hermanos, and Ramon V. del Rosario, co-founder of Phinma. 

With Jobo acting as president, then the youngest bank head at 36, Montinola was unanimously elected as chairman, Gaboldon as vice chair, with Virata as treasurer. Their initial office was room 210 of the Bank of the Philippine Islands building on Plaza Cervantes, perhaps an early portent of things to come. 

The FMF Trade Center Bldg., for many years the Far East Bank HQ. Source: Philippine Arts and Architecture, 1960.

Open for business

Far East Bank officially opened for business on April 4, 1960, Monday, at the FMF Trade Center Building on Muralla St. in Intramuros.

Of that period, Jobo reflects: “When I organized the bank. I had definite ideas on how it should be run. I chose every person I asked to join me. And I chose them for a reason: I wanted vision, variety of experience and, most importantly, a preoccupation with long-term objectives.”

Strategic merger with BANCOM and becoming a universal bank

In 1974, Augusto Barcelon, chairman of pioneering investment bank BANCOM, initiated a strategic merger with Far East Bank, which by this time had Chemical Bank of New York as a significant stockholder.

This brief marriage brought together two titans in the local banking field: Barcelon as president and Jobo as chairman. In 1982, meanwhile, Far East Bank would receive its universal banking status from the Central Bank of the Philippines.

A snapshot of the Far East Bank website circa 1997. Source: Archive.org

Into the 1990s 

By the 1990's Far East Bank had truly grown by size and scope, offering a menu of services to include leasing and finance, insurance brokerage, stock brokerage, investment banking, even IT services.

In 1996, the bank's total resources stood at P123,802,865 while net income for the year was at P2,263,856.

Its board of directors in 1997 had such heavyweights as Jose L. Cuisia Jr. representing Philamlife as chairman, Henry and James Go and Robina Gokongwei-Pe representing JG Summit Holdings, Henry Sy Sr. of the SM Group, as well as representatives from Sakura Bank Limited of Japan.

A new, 28-storey head office building with an all-glass façade on Gil Puyat Avenue would follow.

During its 30th anniversary, Far East Bank, led by President and CEO Octavio V. Espiritu, acquired a valuable collection of artworks by Juan Luna, later repatriated to the Philippines. These works, originally held by Juan Luna's daughter-in-law Grace Luna de San Pedro, were generously donated to the National Museum collection.

Mega merger with BPI

In 1999-2000, Far East Bank — which ironically had used “A bank is forever” as one of its last slogans — merged with BPI in what was then the largest bank merger, with the latter as surviving entity.

“All 10 of Far East Bank's board members who attended a special meeting Wednesday agreed to the offer from BPI,” reported the Wall Street Journal at that time.

The merger of the two banks created the 10th largest financial institution in the region with over $3.5 billion in capital.

About the author
Ramon C. Nocon
Ramon C. Nocon

Features Reporter

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