JP Morgan’s Rise As Top US Bank To Benefit The Bpo Industry
It is predicted that the emerging No. 1 US bank, JPMorgan Chase and Co., would soon aggressively offshore more back- office jobs to the Philippines. “We do not see any significant fallout from the recent collapse of a number of US banks, or their absorption by larger rivals,” said Catanduanes Rep. Joseph Santiago, chairman of the House information and communications technology committee.
“When American firms slash costs due to mergers or an economic slowdown, the first to go tend to be high-paying US-based jobs. They hardly bother to reexamine toward scaling down their low-cost outsourcing activities here, at least not on the basis of cost,” he said.
US financial institutions, along with telecommunication, Internet, direct broadcast and cable-TV providers, are among the biggest clients of Philippine BPO firms. One of them is 119-year-old Washington Mutual Inc. (WaMu), the erstwhile largest American thrift and savings closed by the US government, and its banking assets sold at a fire-sale price to JPMorgan.
WaMu has been a key client of PeopleSupport Inc., which runs three contact centers that employ around 8,000 college-educated, fluent English-speaking Filipinos. “Among US banks, JPMorgan is the most comfortable with the Philippines. The bank has been here for 47 years. It has become totally acclimatized to our political and economic conditions,” Santiago said.
“Our sense is, now that it has become larger, JPMorgan would be inclined to build up in a big way its contact centers and other back offices here,” he added.
JPMorgan first outsourced customer support jobs to the Philippines in 2003, by putting up a 900-seat contact center in Makati City. The US bank recently launched a new 1,400-seat contact center in Taguig City.
After acquiring the Bear Stearns Companies Inc. in March and then WaMu last month, JPMorgan has emerged as the largest US bank in terms of market capitalization, surpassing Bank of America Corp. and Citigroup Inc.
Santiago, meanwhile, said he expects the American International Group Inc. (AIG) to sell its local outsourcing subsidiary, AIG Business Processing Services Inc. (AIG-BPSI).
AIG-BPSI provides back-office operations and contact-support services for AIG businesses worldwide.
Information technology-enabled service industries have been a key driver of Philippine economic and employment growth. Driven mainly by contact center and back-office contractors, the industries are expected to fully engage 920,764 Filipinos and generate up to $12.2 billion in annual revenues by 2010, according to the Business Processing Association of the Philippines. Source