The Philippines Senate has approved a bill designed to enable international banks to hold 100% stake in local banks in the country.

Known as Senate Bill (SB) 2159, or the "Act Liberalizing the Entry and Scope of Operations of Foreign Banks in the Philippines," the new regulation will allow entry of established, reputable, and financially sound foreign banks in the country.

The bill’s proponent and chairman of the committee on banks, financial institutions and currencies, Senator Sergio Osmeña III was quoted by rappler.com as saying that the Senate Bill no. 2159 will allow the country’s economy to reap the benefits.

The bills also awards locally incorporated subsidiaries of foreign banks the same banking privileges as domestic banks of the same category, Osmeña told the publication.

"Greater foreign participation in the banking and financial sectors is expected to augment the financial resources to which the Philippine economy may have access," Senator Sergio Osmeña III said in the statement.

He further pointed that the new legislation will provide Philippines considerable benefit in the economic integration of the Association of Southeast Asian Nations (ASEAN), where a common banking framework will be implemented in 2015.

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