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C A N T I L A N B A N K

Your friendly community bank www.cantilanbank.com

NOW

CBI Loan Portfolio grew 22% in 20122012 loan target achieved months ahead of schedule

The bank’s loan portfolio has always contributed greatly towards growth in earnings. Despite a slight dip from January to February 2012, Cantilan Bank’s loan portfolio enjoyed an increasing trend for the rest of the year. In October, the 2012 year-end target portfolio of Php1.01 billion was achieved, one quarter ahead of schedule.

As of December 31, 2012, the bank’s loan portfolio grew by 22% from 2011 levels, reaching Php1.076 billion. The targeted 16% growth achieved in October was surpassed by an extra Php60 million boost from the DepEd Salary Loan Enhancement.

This extraordinary growth was also tempered by a deliberate decrease in the total past due accounts through the strict mitigation efforts implemented by the Account Management Division and all branches especially in the last quarter.

In 2013, these mitigation efforts will continue together with the efforts to maintain a steady increase in the portfolio in order to achieve the set targets. No doubt, these targets will be met especially as the bank’s branch expansion continues in the first half of 2013.

Forecasted Actual

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2010 2011 2012

Loan Portfolio

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15% Deposit Portfolio growth in 2012 2012 saw an increase in all deposits across branches

Cantilan Bank’s deposit portfolio reached an all-time high of Php807 million at year-end 2012 representing a 15% growth from the 2011 portfolio. As of February 2013, the total deposit portfolio grew by another 3.4% reaching Php834 million.

Forecasted Actual

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225

450

675

900

2010 2011 2012

Deposit Portfolio

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Building a bridge from where we are today to where we want to be tomorrow

CBI awarded by LandBank as #1 in Caraga and Best in Capital Buildup For the second year in a row, CBI was awarded as the Most Outstanding Bank in the reg’l level and came 2nd place in the nat’l level. CBI also bagged 2 other LBP awards. Page 2

CBI opens 22 MBOs in 2012 and 4 Branches in Q1 2013CBI makes its mark in CARAGA and the Visayas! Page 2

Sustaining 4Ps communities thru CSR2012 was a watershed year in the history of CBI and CBFI - by taking on the challenge of servicing CCT beneficiaries, it became the concrete expression of our shared mission to develop the countryside together with partners.Page 7

Stories from the field

Know more about what our CBI staff are made of by taking a peek at some of the challenges they encounter daily.Page 8

Events2012 was a very memorable year full of achievements and loads of activities - CHQ hosted no less than 9 events and each of the branches hosted 3. Page 9

Annual NewsletterIssue N o5 - March 2013

Feature articleCantilan: the least poor area in CaragaAccording to the NSCB, only one fourth of Cantilan’s population is considered poor (earning less than P14,000 p.a.). What does this mean for us here in Cantilan Bank? Page 6

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2 Your friendly community bank

C H A I R M A N ’ S M E S S A G E

In its 32 years in the community banking industry, Cantilan Bank, Inc. has always risen above all the challenges that it met. These challenges, both internal and external, run the range from higher risks in lending to increased competition; from tighter government regulations to bigger operational challenges. When faced with these obstacles, CBI’s many strengths allowed us to turn these challenges into opportunities to deliver better services to our clients.

2012 was a very important year wherein we laid the foundation for several of our growth strategies. From just one local bank in the heart of Cantilan, we have now grown to a remarkable 18 branches (as of March 2013) and 19 Micro-Banking Offices (MBOs) spread out over the Caraga region and now with a strategic presence in the Visayas. This rapid brick-and-mortar growth has helped us expand our market organically and has bolstered our financial sustainability by allowing us to serve previously under-served and unbanked market segments.

Our growth in 2012 could not have been made possible without technology and innovation. Last year, we became the first rural bank in the province of Surigao to offer ATM services in our areas of operation. We also embarked on a multi-million-peso core banking software modernization program helping ensure management efficiency and giving us a powerful competitive edge. Furthermore, we continually enhanced our products portfolio, adding microinsurance, current accounts, and Home Finance Loan in 2012.

As in all previous years, our commitment to deliver responsible and transparent microfinance services has given us a distinct advantage over other industry players. Experience has shown that our MF clients have become not just credit-disciplined borrowers but good savers as well through financial education. Last year, we expanded our financial literacy initiatives to the 135,000+ participants of the government’s Conditional Cash Transfer or 4Ps program that we service.

Looking back at all our achievements, I would like to commend the management and staff for their superb performance. Our gratitude goes out to the members of the board and, most of all, to you - our stockholders and clients - for your unfailing trust, loyalty, and confidence in our bank. We look forward to your continued support and partnership in 2013.

Lt. Gen. William K. Hotchkiss III

!

Land Bank: CBI #1 Rural Bank in Caraga and Best in Capital Build-up in 2011CBI grabs LBP top awards for the 2nd time in a row.

By: Sheryl G. Asio

Cantilan Bank proved itself once again as one of the country’s most stable and reliable rural banks by bagging, for the second time in a row, another set of awards given by the Land Bank of the Philippines (LBP).

The 1.3-billion peso bank was cited as 2011’s Most Outstanding Rural Bank for both National (second place) and Regional levels (first place) for its accomplishment and lasting contribution to countryside development. CBI was also given the award for Best in Capital Build-up for its continuous effort to strengthen its capital base.

Cantilan Bank also received the same rewards last year as the Most Outstanding Rural Bank and was also conferred the award for Best in Reciprocal Business.

“This set of awards represents an affirmation of Cantilan Bank’s unwavering efforts to be a leading force in community banking and in countryside development, as well,“ General Manager Raul B. Urbiztondo said.

By next year, the Bank aspires to be a part of the Hall of Fame awardees for the third time and bag the Golden Award which recognizes countryside financial institutions that have sustained highly sound and profitable operations throughout the years.

Leyte Representative and Chairman of the Congressional Committee on Banks, Sergio F. Apostol, led the awarding ceremonies with Land Bank President and CEO Gilda E. Pico held at the LBP Plaza, Malate, Manila on August 28, 2012.

CBI opens 22 MBOs in 2012 and 4 branches in Q1 2013By: Colleen Barrot

From January to July 2012, Cantilan Bank, Inc. officially opened the 22 BSP-approved Micro-Banking Offices (MBOs). Sometimes described as a mini-branch, an MBO can offer a variety of products and services in addition to the non-transactional banking-related activities performed by the regular Other Banking Offices (OBOs).

Like regular branches, MBOs are also compliant to BSP regulations by having adequate manpower, central liability ledger systems, online and real-time core banking system, strong and reliable telecommunication lines, well-trained and highly-motivated managerial staff, and a reliable security system.

Of the 22 MBOs approved, three MBOs were relocated and opened namely- Malimono, Surigao del Norte to Tag-anito, Surigao del Norte; Diatagon, Surigao del Sur to Asuncion, Davao del Norte; and Ampayon, Butuan City to Tungao, Butuan City.

On 20 July 2012, the Bangko Sentral ng Pilipinas (BSP) also approved the conversion of four (4) existing MBOs into regular branches and establishment of a new regular branch in the following locations:

1. For conversion to regular branch:•Dapa, Surigao del Norte•Lianga, Surigao del Sur•Lingig, Surigao del Sur•Gingoog, Misamis Oriental

2. For establishment of a new branch•Sogod, Southern Leyte

On 04 February 2013, Gingoog was inaugurated as the 15th branch, Lingig and Lianga were also officially opened as regular branches on 08 February 2013, and Sogod, Southern Leyte on 18 March 2013. MBO Dapa will soon be converted into a branch in the 2nd quarter of 2013.

As of March 2013, Cantilan Bank has 18 branches, 19 Micro-Banking Offices, and 3 Other Banking Offices spread out over Caraga with a strategic presence in the Visayas.

L-R: CBI EVP B/Gen Charles Hotchkiss, Gingoog BH Neil Brian Quinonez, Gingoog Mayor Ruth Guingona


Your friendly community bank 3

CBI launched CBKalinga Microinsurance Aug 2012 in all branches

By: Elia Mae Ornilla

In August 2012, CBI formally launched its first microinsurance product in all 14 branches and 22 MBOs. CBI partnered with Country Bankers’ Life Insurance Corporation as an agent for the microinsurance product CB Kalinga. Through its many features including instant abuloy, death benefits, accidental medical reimbursement, daily confinement benefit, and financial assistance, CBI hopes to provide extra security and protection to its clients at a very affordable price.

In the six months since its launch, CBI gained 7,006 new policy members, sold 7,250 units, and distributed P1,084,393.45 in claims to beneficiaries. The positive results are a testament to how useful the product is and how relevant it is to the market.

HFL launched in all branches in Q1 2013By: Richelle S. Arpilleda

In October 2012, Cantilan Bank launched its latest product, the Home Financing Loan (HFL), in Cantilan and Tandag branches. The pilot launch aimed for a target portfolio of Php 2 million.

HFL’s portfolio reached Php900,000 as of January 2013. This newly launched, innovative product provides affordable and accessible credit to qualified salaried government employees or fixed-income earners for their housing needs.

The pilot phase ended in February 2013 and the product was launched fully across all CBI branches in March 2013.

For more information on this product, visit www.cantilanbank.com or email [email protected].

Former PAF Chief and CBI President and Chairman, Now CAAP HeadBy: Jolly Guiral

Last June 2012, Lt. Gen. William K. Hotchkiss III, AFP (Ret.) was appointed by His Excellency President Benigno Simeon “Noynoy” Aquino III as the new Director General of the Civil Aviation Authority of the Philippines (CAAP). Due to his appointment, Lt. Gen. Hotchkiss filed his leave of absence as President of Cantilan Bank in order to perform this tough task as DG of CAAP. He was given one year to get the Philippines out of the Category 2 status of the U.S. Federal Aviation Administration (FAA) as the Philippines was downgraded in 2007 due to safety and management issues.

On March 1, 2013, the International Civil Aviation Organization (ICAO) determined from the results of their audit conducted in February 2013 that the CAAP successfully addressed and resolved all the Significant Safety Concerns identified by the ICAO in 2009.

The U.S. FAA bases its own safety assessments of countries operating to and from the United States on the findings of the ICAO.

Lt. Gen. William K Hotchkiss III was at the helm of the success of Cantilan Bank when he sat as the President and Chairman of the Board of Cantilan Bank from the year 1999 up to the present. Since then, his unwavering thrust towards excellence in community banking has brought Cantilan Bank to its present position in the rural banking industry. Through his leadership, Cantilan Bank was recognized not just in the rural banking industry but also in the global arena as international visitors from different countries visited Cantilan Bank.

Hotchkiss served as commanding general of the Philippine Air Force from 1996 to 1999 before he became President and Chairman of the Board of CBI.

P150M Capital infusionDuring its regular meeting on November 2012, the Board of Directors approved BOD Resolution No. 12-174 that increased the amount of authorized capital stock from the existing One Hundred Fifty Million (P150M) to Three Hundred Million (P300M) to support the bank’s strategy of gradual expansion. ABC

Productive Recruitment and Hiring in 2012 By: Ly-Ann Urbiztondo

Cantilan Bank employed a total of eighty nine new hires last year.

Like all newly-hired staff, these trainees underwent the General Orientation Course (GOC) held in Cantilan, Surigao del Sur. Based on HR’s records on the GOC, CBI has an average of only three batches of GOC trainees per year. But in 2012, CBI was more productive in recruitment and hiring and was able to conduct four rounds of GOC in the whole year.

The first GOC round in the previous year was conducted from May 7 to 18, 2012 with 28 total participants. In the second round held July 16-27, 2012, there were 27 participants. Another twenty seven participants followed in September 17-28, 2012, while the fourth batch on December 3-7, 2012 had seven participants.

The screening process of CBI includes going through a qualifying exam, a panel interview, background investigation, and the General Orientation Course.

By hiring a total of eighty nine new personnel last year and having successfully utilized and deployed each in the operations of the bank, CBI achieved productive results in the continuous process of recruitment and hiring.

As of December 2012, CBI had a total of 316 employees made up of 270 regular employees, 46 casual employees, and 47 trainees. To apply, please email [email protected] or [email protected].

http://www.cantilanbank.comhttp://www.cantilanbank.commailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]



CBI BOD and Compliance attend new Rural Bank Management CourseBy: Colleen Barrot

Cantilan Bank, Inc. was one of the first rural banks to attend the newly integrated 4-day seminar-workshop for rural banks “Rural Bank Management Course (RBMC) held at BSP-Manila last January 28-31, 2013. The Rural Bankers Association of the Philippines (RBAP), through the Rural Bankers’ Research and Development Foundation, Inc. (RBRDFI) conducted this training as part of its continuing strategy to strengthen the rural banking industry.

Three participants of Cantilan Bank namely, Alan Y. Hotchkiss (Member of the Board of Directors), Lolita R. Corcuera (Member of the Board of Directors), and Colleen Mary C. Barrot (Compliance Officer), were among the 32 participants from the 14 rural banks who attended the RBMC.

Deputy Governor Nestor A. Espenilla, Jr. welcomed the participants on the first day. Topics in the 4-day training were Risk-Centric Oversight Banks: A Macro-Financial Perspective; Introduction to Financial Risk Management; Governance and Control; Financial Statement Analysis and BSP- Reportorial Requirements.

RB Management Course is a foundational course for the RB senior management team and an offshoot or an enhancement program from the previous Basic Rural Banking Course (BRBC). The program emphasizes the oversight role of rural bank management and directors, and operational aspects of banking.

CBI launches new website, joins Facebook and TwitterBy: Catherine L. Duero

Social media channels such as Facebook and Twitter have created incredible opportunities to network and interact online through the internet. These channels can connect millions of people around the world and have greatly improved our means of communication.

As a powerful communication channel, social media has tremendous uses for advertising, promotional and marketing campaigns, and branding. As a medium, it has a couple of advantages over traditional media -- it can be incredibly efficient in reaching desired target markets and can be very cost-effective.

So in 2012, Cantilan Bank joined Facebook, Twitter, and even LinkedIn. To make it more attuned to clients’ needs and to match CBI’s tagline “Your friendly community bank”, CBI’s website www.cantilanbank.com was re-designed and re-launched in December 2012.

Not only can these channels be viewed as a means for marketing but as a feedback mechanism as well. The availability of information on the internet makes the bank more accessible to the world. You can find out about our exciting promotions, events, and other important announcements through our website and our Facebook page. More importantly, customers’ queries and concerns can be promptly addressed without having to visit our office. Just drop us a line here www.cantilanbank.com/contact-us or simply email us at [email protected].

As of March 2013, Cantilan Bank enlisted 1,885 Facebook friends. Its freshly created fan page gathered 284 likes; in just 2 months, 60 tweets mentioned Cantilan Bank, and a number of our events which were widely promoted online were carried out successfully.

So, don’t forget -- like our Facebook fan page at facebook.com/cantilanbank and be the first to know about our promotions and events! You can also follow us on Twitter @cantilanbank.

Send remittances from HK directly to your Cantilan Bank MoneycardMoneycard, a New Remittance Facility

By: Catherine L. Duero

Filipinos in Hongkong can now send their remittances back home conveniently through Cantilan Bank’s MONEYCARD.

In December 2012, the bank announced its partnership with BHF Northern Remitttance to provide electronic money transfer services to overseas Filipinos in Hongkong. This partnership is a great way for Hongkong OFWs to gain easy and affordable financial access to their loved ones who live in the remote parts of the country. In turn, beneficiaries can now easily claim their remittances anytime, anywhere in the country.

Below are the suggested easy steps to use Moneycard in sending and receiving remittances:

1. Apply for CBI MONEYCARD (ATM) Account at the nearest Cantilan Bank Branch and get your Cantilan Bank ATM Card the next day;

2. Provide your Hong Kong-based relatives with your 16-digit MONEYCARD account number and tell them to send their remittances to your Moneycard account through BHF Northern Remittance at SHOP 328 3/Floor Worldwide Plaza, 19 DES Voeux Road, Central District, Hong Kong;

3. Upon receipt of the remitted funds, you may withdraw your money at any ATM nationwide!

A friendly, flat-rate service fee of HK$12.00, equivalent to about Php60.00, is charged by BHF per transaction.

For more information on how to open a Cantilan Bank Moneycard account, visit www.cantilanbank.com/moneycard-atm. You can also learn more about how to send and receive remittances by visiting www.cantilanbank.com/remittances.

Words of WisdomLeadership is the art of getting someone else to do something you want done because he wants to do it.

Dwight Eisenhower

http://www.cantilanbank.comhttp://www.cantilanbank.comhttp://www.cantilanbank.com/contact-ushttp://www.cantilanbank.com/contact-ushttp://www.cantilanbank.com/moneycard-atmhttp://www.cantilanbank.com/moneycard-atmhttp://www.cantilanbank.com/remittanceshttp://www.cantilanbank.com/remittances



2013 Operational planning in BukidnonBukidnon, the country’s landlocked province located in the Northern Mindanao region, was the easy choice as the venue for the bank’s 2013 Operational Planning. The lush vegetation and its variety of flora and fauna made for a relaxing and inviting atmosphere perfect for a planning session. The entire CBI planning team - composed of the members of top management, division heads, department heads, and branch heads - were accommodated at the Central Mindanao University hostel located within the campus.

The goal of the operational planning session held on November 8 and 9, 2012 was to assess the bank’s performance in the two years since the Strategic Planning in 2010. The strategies set out in 2010 requires annual assessments in order to ensure that the organization is on the right track towards achieving its goal. The team, facilitated by its consultant Eduardo de Castro, reviewed, analyzed, and reported the performances of each of their respective offices and presented specific objectives, plans and programs that shall be implemented for the year 2013.

Tanya Hotchkiss, Head of the Office of Strategic Management and who took the lead during the planning activity, stressed that as Cantilan Bank moves towards the future, a strategy or a bridge where CBI is today and where CBI wants to be tomorrow must be determined. She further emphasized the role of the company’s vision of becoming the leading force in the community banking industry and its mission of delivering excellent banking and countryside development services, and developing a well-trained and highly-motivated workforce. She highlighted, as well, CBI’s triple bottomline: financial, social, and environmental.

On a lighter note, right after the planning session the whole team was treated to a quick tour of Bukidnon which included side trips to a carabao dairy farm, Dahilayan Adventure Park, the Del Monte Country Club, a monastery with a coffee plantation, and views of Musuan peak. JTG

CBI’s OSM honored as next-generation global development leaderTanya Hotchkiss, Head of Cantilan Bank’s Office of Strategic Management, was honored with a Devex Manila 40 Under 40 award for her outstanding work in the international development community in Manila.

Tanya was honored with other awardees at a private reception on Feb. 19, 2013 at the Zuellig Building in Makati City, where select government officials, corporate and NGO executives, and community leaders attended.

The Devex 40 Under 40 award highlights and celebrates the work of 40 young leaders in the international development community all under the age of 40 in cities around the world.

Following a public nominations process and rigorous review of more than 250 nominees, awardees were selected based on their influence on the development agenda and impact on development results in the Philippines and abroad.

Tanya joins the distinguished ranks of past Devex 40 Under 40 winners such as U.S. Agency for International Development Administrator Rajiv Shah, Cherie Blair Foundation for Women CEO Henriette Kolb, Google’s Jared Cohen and Obama Administration Senior Foreign Policy Adviser Samantha Power.

Following successful 40 Under 40 events in London in 2011 and Washington, D.C., in 2010, Devex is proud to have selected the Philippines as the first emerging country to host this event.

Chevron is the founding sponsor of the Devex 40 Under 40. For more information, please visit the Manila 40 Under 40 website at manila40.devex.com.

Devex is a membership organization delivering business information and recruiting services to the international development community, connecting 500,000 relief and development professionals to a dynamic network of information, people and ideas, and enabling them to have more impact for more people.

Farewell to MABSThe bank’s early practices of providing people access to capital for their small businesses and other financing needs was focused on a collateral-based loan system. But in the second semester of 1999, the bank partnered with the Microenterprise Access to Banking Services (MABS) program and started KITA (Kita Insakto Tipon Asenso), an uncollateralized and cash flow-based loan product for individual micro-entrepreneurs. Because of the initial success of this initiative, MABS’ cash flow-based methodology - which was first applied in individual lending - was applied to group lending and eventually to regular loan products especially to salary loans and other time loans.

MABS is a USAID-assisted project which implemented programs with the main objective of providing technical support to rural banks in developing the capability to profitably provide financial services to microentrepreneurs, small farmers, and other low-income households of the country.

CBI highly benefited from the technical assistance from MABS consultants. Until now, 13 years later, several bank employees are still called MABSTers - a nickname for those who graduated from the MABS technical training program with flying colors. Aside from the training, MABS also introduced technology as a tool towards successful implementation of microfinance (MF) programs and the bank became more innovative and proactive in developing and marketing its products.

To date, Cantilan Bank, a four-time MABS Eagle Awardee for its outstanding MF performance, has its own MF unit that oversees the entire MF operations which contribute 11-15% to the bank’s total loan portfolio. The MABS legacy of innovative technology, systematic approach, best practices in lending, and even client retention measures are just a few things that the bank continues to proactively use.

The bank believes that microfinance is a very effective tool in contributing to the economic and social growth in the countryside through the delivery of appropriate, timely, and quality credit and savings assistance to the entrepreneurial poor of the community. CBI also believes that MABS was highly instrumental in the success of the entire organization. MABS bid goodbye to CBI in September 2012. RSA, GNAL

L-R: Devex Manila Director Pete Troilo, CBI OSM Tanya Hotchkiss, DSWD Sec. Dinky Soliman

L-R: CBI GM Raul Urbiztondo, MABS Deputy Chief of Party Meliza H. Agabin, MABS Chief

of Party John V. Owens, CBI Chairman Lt. Gen. William K. Hotchkiss III

http://manila40.devex.com/hotchkiss/http://manila40.devex.com/hotchkiss/http://manila40.devex.com/http://manila40.devex.com/


6 Your friendly community bank - like us on facebook.com/cantilanbank

By: Tanya Hotchkiss

In August 2012, the National Statistical Coordination Board (NSCB) published the 2009 poverty statistics at the municipal and city levels. Why is it important for us here in Cantilan Bank to know this? These poverty statistics are very useful tools in planning our financial inclusion efforts and achieving our mission.

Just to refresh your memories, our mission here in CBI is to deliver excellent banking and countryside development services to clients. Furthermore, one of the five objectives of CBI is to achieve the social and environmental bottomlines. This means that we can only call ourselves successful community bankers if we achieve the social bottomline and the only way we can do this is if we are able to reach the financially underserved and unserved through the delivery of financial education and other financial services.

Now, what exactly does this have to do with statistics, you might ask?

Statistics - what is it good for?

If you’re a professional athlete, how do you know that your performance has improved or deteriorated? If you’re a swimmer, how do you know if you were faster than the other guy? If you’re a basketball player, how do you know your team beat the other team? And, if you’re a tennis player, and you know you have to go up against Roger Federer in the next few months in the French Cup, how would you adjust your training for your serve and forehand?

Measuring numbers and statistics and correctly understanding them and applying them is key to improving your performance in any field, be it sports or business.

Cantilan and Cantilan Bank

In our case, we can measure our success in terms of achieving our objectives and overall mission if we look at certain Key Result Areas (KRAs) and performance indicators. Simply put, if part of our mission is to help our community develop, then we

obviously need to measure the level of progress our community has achieved over the years. One KRA we can look at to measure the development and progress of any community is the level of poverty incidence.

Let’s take a closer look at Cantilan’s statistics. Did you know that Cantilan had a population of about 30,000

individuals and about 6,900 households in 2011? Of the 6,900 households, only 896 were engaged in non-farming and non-fishing related industries. This means that, as of one year ago, 87% of the households in Cantilan depended on farming and fishing as a source of income and a means of livelihood.

What’s astonishing though are Cantilan’s levels of poverty incidence in 2003 and 2009. In 2003, 43% of Cantilan’s population lived below the poverty line. Another way of putting it is that, nine years ago, close to half of Cantilan’s population had net incomes of less than P14,000 in a year!

In the 2009 national poverty

statistics, however, Cantilan was shown as the least poor area in the entire Caraga region, with only 25% of its population considered as poor. This means that Cantilan’s poverty incidence was cut almost in half in just six years! This is incredible!

(Story continued on page 7)

Cantilan: the least poor area in Caraga

You cannot manage what you cannot count.

- Lt. Gen. William K. Hotchkiss III


Follow your friendly community bank on Twitter @cantilanbank 7

Cantilan: the least poor area in Caraga (cont.)

As of 2009 data, only one quarter of Cantilan’s population is earning less than P14,000 in a year. To put things on a national perspective, our 25% poverty incidence is better than the national average. Also, according to the NSCB 2009 statistics, Cantilan is less poor than all the other municipalities AND cities combined in the whole of Caraga!

Do you think slashing poverty rates almost in half over six years is development? You bet! Do you think being categorized as the least poor area in an entire region, compared to other cities which are supposed to be more developed than small rural towns, is equal to progress? Definitely!

Of course, we cannot take full credit for the success of our community but, it surely sounds like a reasonable argument if you say that CBI has played an integral role in Cantilan’s development and growth. To back that statement up, here are a few facts to consider: as the largest, professional employer in town, CBI has provided quality jobs, harnessed and developed local talent, and it has also become the largest taxpayer and source of revenue for the town. More importantly, through the hard work and dedication of all its employees, CBI has created a sustainable and highly productive professional industry in a rural town in Eastern Mindanao where agriculture is the primary industry. Furthermore, CBI has successfully engaged in microfinance since 1999, extending credit to many micro-entrepreneurs and conducting financial literacy workshops and seminars along the way.

Analyze this

Now that we know that Cantilan’s poverty incidence dropped from 43% to 25%, we need to find out exactly how Cantilan Bank figured in this development with respect to our microfinance and financial inclusion activities. Unfortunately, to answer this question, we need to do a lot of research and analysis, both of which require lots of investment in time and resources. Luckily though, through partner research institutions, CBI can have a clearer picture as to how our microfinance and financial inclusion activities has affected the levels of poverty in all the communities where we work. Before the end of 2013, we can all look forward to seeing how we performed in this Key Result Area so that we know how much improvement we need to achieve in the next few years.

This may seem like a daunting task to some of us, but that’s what sets us apart from our competitors -- we here at CBI know and truly believe that we can only be as successful as our community is. And, our mission is a commitment that our community can bank on.

For questions and suggestions, email Tanya at [email protected].

CBI’s Financial Literacy InitiativesBy: Grace Naumi Lim

According to the first Consumer Finance Survey conducted by the Bangko Sentral ng Pilipinas (BSP) which was released April of 2012, 8 out of 10 Filipinos do not have bank accounts and about 40% of households do not have any money set aside for “rainy days”.

The survey also showed that most Filipinos consider saving in a bank as unnecessary for the simple reason that they do not have extra money to save. Other reasons cited for not having bank accounts include aversion to bank transactions, high minimum account balance requirements, and lack of access to banking services.

These findings have prompted BSP Governor Amando Tetangco, Jr. to call for greater efforts to achieve a more inclusive financial system so that more people could have access to bank services.

Meanwhile, when Cantilan Bank introduced microfinance to its clients back in 1999, it already had in mind to design products that were accessible and relevant to the un-banked segment. CBI’s loan products thus came with a “requirement” -- savings should be embedded in the weekly amortization. This idea then spurred the creation of micro deposit products.

During campaigns for micro deposits, the bank conducted several financial literacy workshops, one of the first of which was introduced among the indigenous peoples in the towns of Claver and Alegria in 2010. Financial education campaigns were also regularly done for members of CBI’s Student Savers’ Club (SSC) and, more recently, with the 4Ps or Conditional Cash Transfer (CCT) beneficiaries whom the bank has been servicing since February 2012.

The financial literacy training comprises introductory courses in basic financial recording and budgeting, discussions on the present financial situation of individuals and families, sharing the basics of proper financial management, and encouraging the participants to open a savings account.

To date, Cantilan Bank has conducted financial literacy training to 4Ps beneficiaries in the 272 barangays where the bank operates and this group has generated a total of 1,501 accounts with a total portfolio of P713,218.65.

Cantilan Bank, with its own version of 4Ps - Pagdaginot, Pagtipon, Pamuhunan, and Pagpalambo™ - will continue to provide such trainings to help address the low levels of financial literacy and financial inclusion in the countryside.

For questions and suggestions, email Ging at [email protected].

Sustaining 4Ps Communities Through CSR By: CBFI Executive Director, Tinty Iriberri

Parallel to the relentless efforts of CBI to pursue its vision as a leading force in community banking is its commitment to leave no sector behind in its journey towards a meaningful, integrative, and sustainable community development and economic growth.

Cantilan Bank Foundation, Inc. was organized in 2003 to take care of the social development dimension of CBI and is tasked to bring to the core of community development the three-fold bottom line of CBI’s corporate social responsibility - financial literacy, social preparation, and environmental sustainability.

This brings to light CBFI’s vision as a leading enabler and catalyst for reforms towards empowered, financially literate, and sustainable environment-driven communities and clientele.

The vision serves as the strategic framework of CBFI’s blueprint outlined into four key development milestones:

• Capacitate and organize a pool of CSR volunteers

• Advance and promote the CBI core bottom line as a viable option to scale-up social capital

• Develop enabling environment as a venue to empower CBI partner communities and clientele

• Help build healthy, peaceful, productive, sustainable, and ecologically-sound communities.

As a strategy to translate CBFIs mission to action, it entered into a volunteer partnership agreement with DSWD in the implementation of the 4Ps program.

The engagement provided the opportunity for both CBI and CBFI to put on the ground its triple bottom line and complete the loop of community development intervention as service provider for the conditional cash transfer program and partner in enhancing the financial and economic capacity of the 4Ps, thereby providing opportunities for sustainability even beyond the 4Ps program.

The intervention includes the servicing of CCT grants cash transfer through the bank’s ATM services, providing financial literacy value formation through the 4Ps monthly Family Development Sessions (FDS), social preparation, community organizing, skills enhancement and livelihood training, active community participation, and environmental conservation.

The 4Ps program is a poverty-reduction strategy of the national government that provides conditional cash assistance to extremely poor households to help improve the health, nutrition and education especially of children aged 0 to 14 years old. The program also promotes responsible parenthood through the conduct of the monthly Family Development Sessions (FDS) and FDS+ to enhance productivity and community involvement and participation.

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Stories from the fieldStories from our branches who have enjoyed celebrating life with their communities and being one with them in more challenging times.

The ravages of Typhoon Pablo

Provinces located in the southern part of Mindanao - Compostella Valley, Davao del Norte, and Davao Oriental experienced great devastation caused by Typhoon Pablo in December 2012. The category 5 typhoon created tremendous damage to the lives and livelihood of the people in these communities and will take a long time to rehabilitate.

Cantilan Bank has been operating in these affected areas. Despite sustaining some physical

damage to its Tagum City branch, the bank was still able to implement Oplan Tabang, Cantilan Bank’s relief operations extended to the victims of the typhoon. CBI, in coordination with the LGU in the 12 municipalities greatly affected by Pablo, offered assistance by donating food, clothing, and funds.

During regular, monthly cash payouts to DSWD 4Ps beneficiaries, the bank was providing conditional cash transfer services in the 3 provinces mentioned with a total of 42,000 recipients. After the typhoon, the bank continued to provide the service along with some encouragement and financial advice on how to spend their CCT allowance wisely and how it can positively help restore their livelihood.

When the Municipality of Cantilan extended help to the victims of Pablo through medical missions and donations of medicine, food, and clothing, the bank provided transportation services to the team.

The Island Life

The people on the island of Socorro, located off the northeastern coast of Mindanao and facing the Pacific, are renowned for their bayanihan or community spirit. Every year during the month of July, the islanders actively participate in bayanihan - helping neighbors construct or renovate their houses, cooperating with the entire community in fishing and food production.

Another event that islanders look forward to participating in every year is their town’s foundation celebration on February 22. The highlights of every celebration are the “Tinabangay” and “Harog” festivals. In the Tinabangay festival, Socoronhons celebrate by having dance performances and, more importantly, helping each other build houses in

true bayanihan fashion. Meanwhile, the “Harog” festival is all about making and eating lots of harog otherwise known as ginat-an or binignit in Visayan. Harog usually consists of sweet, sticky rice boiled in coconut milk with various root crops like sweet potato and cassava, sago, and sometimes langka or jackfruit is added for an additional flavor.

In the 2012 celebration, CBI supported this community of islanders in celebrating their unique activity by joining the two festivals. CBI put up a promotional booth and set up a public water station, while serving harog to all participants. All in all, it was a successful and very enjoyable event that CBI looks forward to supporting in the years to come.

Client Success Story

Julieto D. Octaviano and his wife Selma M. Octaviano have been CBI microfinance clients since December 2007. Selma first availed of a KITA loan (Kita Insakto, Tipon Asenso) of P10,000.00 as additional capital for her growing sari-sari store business. Her good repayment record and practice of on-time payment earned

her good credit which entitled her to avail of several MF loan cycles.

Currently, Julieto and Selma are

both still clients of the bank. Julieto is now on his 10th cycle and Selma in her 17th. Since savings is a component for every loan account, it is easy to say that the Julieto and Selma have robust savings with CBI.

Since their first availment of a KITA loan in 2007 to expand their main business in selling various products ranging from basic commodities to school supplies, the couple were able to expand it by venturing into operating a computer shop and a hotdog station. As additional income to these major investments, Mr. and Mrs. Octaviano also supply rice to farmers and fisherfolk in the area and retail Smart and Globe prepaid load.



Events2012 was jampacked with all kinds of activities -- from the SSC Convention to the Bayanihan in Ayoke; from the Balik Cantilan fiesta celebration to the Surfing Competition; from Earth Day to Halloween and Christmas celebrations.



Learning Made Fun through SSCBy: Farrah T. Duero

Student Savers Club (SSC) is Cantilan bank’s deposit product for children. Its purpose is to introduce and promote savings consciousness and discipline among Filipinos at an early age. By becoming a member, children are given the opportunity to practice saving and appreciate its value and impact on their lives.

What better way to attract these children to save than through events, enjoyable activities, games, and other incentives? These undertakings are not just aimed to create banking awareness among children but to maintain their enthusiasm as members of the club and to enhance the bank’s relationship with its clients.

For the year 2012, SSC members were treated to a total of six “free” promotional events where the only requirement to join was for the depositor members to meet the required deposit amount.

SSC Convention. In February 2012, four CBI branches conducted a Student Savers Club Convention which gathered all SSC members of the area for a get-together. Discussions on how to save and budget their allowances marked the start of the event. To measure understanding of the topic, questions were given to the participants after the discussions and prizes were given to encourage the children’s participation. This activity was immediately followed by numerous games, trivia quizzes, distribution of giveaways, and a little salu-salo. This event was joined by 391 participants with a deposit portfolio of Php400,338.00.

SSC Summer Workshop. This is the second annual SSC Summer Workshop which was conducted in seven branches of the bank. The Summer Workshop mainly encourages the members to enjoy the long days of summer while learning at the same time; thus, its slogan: Lets learn, play and have fun this summer! Participants were made to choose from various classes on kindergarten art, performing arts, badminton, and lawn tennis. After the 20-day classes, a tournament and a culminating activity were presented in order to showcase the skills newly acquired by the participants. This summer workshop was participated by a total of 529 participants providing the bank with a deposit portfolio of Php794, 200.00.

Little Chef. In celebration of Nutrition Month in July 2012, CBI hosted the first ever cooking contest among school children of Cantilan, Surigao del Sur. Five schools competed in the high school division and seven schools in the elementary division. During the on-the-spot contest, the participants learned how to budget money since they were given cash to purchase ingredients for their vegetable dishes. They had to buy vegetables and other ingredients from the

mini tabu or fresh market assembled in the plaza -the venue of the contest. Little Chef was also a chance for CBI Pag-uma clients (Pag-uma is a MF

loan product intended for farmers) to showcase their products, specifically those clients who have vegetable produce.

Magtukar Ta. This free music workshop for SSC depositors was conducted during the Cantilan Town Fiesta Celebration. Kuntaw, a local band from Tagum, was hired to teach the kids how to play indigenous musical instruments like kubing, kulintang, bamboo flute, etc. Kids were also

taught how to make rainsticks, an indigenous musical instrument made of bamboo and

pebbles/monggo/rice/sand. The kids experienced the thrill of playing all the musical instruments played by Kuntaw and everyone brought home a rainstick. After the workshop, the kids performed in the town plaza of Cantilan for their parents and the rest of the public. The SSC music workshop was attended by 109 participants and generated micro-deposits of P139,533.00

Halloween Costume Party. As the first ever Halloween Costume Party in Cantilan, the kids experienced the thrill of dressing up in their halloween best. The venue was decked with spider webs, “tombstones”, and “horror” booths where kids went trick or treating. Ghoulish sound effects were played and the food served were bloody-red strawberry-flavored juice and jelly candies shaped like creepy-crawly worms, cockroaches, and spiders. Aside from dressing up in halloween costumes, SSC members also enjoyed the games, giveaways, trick or treat, food, dances, and other surprises. A costume

parade was part of the program so each child had the chance to show off their costume. Awards such as Most Creative, Creepiest, Best in Fantasy, Best in Characterization were given to deserving kids. 110 kids from the 2 branches participated in the event and the event raised the SSC deposit portfolio by P133,065.00.

SSC Christmas Party. This annual SSC event was conducted in nine branches of Cantilan Bank. A total of 751 members participated in the parties and generated a total portfolio of P1.7M. Just like in other SSC events, the kids were treated to several games, giveaways, and snacks. Discussions about saving, budgeting, and Banking on Waste were also conducted with the kids present at the party.

These continued activities for SSC members are made as a reminder for children and the parents to save for their child’s future and for emergency purposes. It is important that kids be encouraged to save and develop saving as a habit. These activities are also meant to help the bank nurture good and lasting relationships with its clientele.

CBI Celebrates 32nd AnniversaryBy: Rodelyn S. Bayang

In celebration of its 32nd anniversary, Cantilan Bank organized Lingaw-Lingaw 2012, a one-day sportsfest participated by all employees from 14 branches of the bank. The sportsfest, which was held on June 9, 2012 at the open field of Cantilan Pilot School, involved several individual and group games which promoted good sportsmanship and camaraderie among CBI staff. All employees were encouraged to join in games such as volleyball, badminton, lawn tennis, running, basketball, softball, baseball, table tennis, and “soccer baseball.”

The theme of the event “Cantilan Bank kauban sa pagdaginot, pagtipon, pamuhunan alang sa kalambuan” stressed the bank’s financial inclusion program - that of extending financial access to under-banked and unbanked segment of society in areas where we operate.

The event was topped off with a dinner dance where contests and games continued, winners were declared, and prizes were distributed. All employees were in high spirits as they treated themselves to a night of dancing and merriment.



Lingaw ra!This is a collection of funny anecdotes as observed by Cantilan Bankers. Banking is serious business but, sometimes, bankers need to cut loose by simply not taking themselves too seriously. Only in Cantilan Bank

When online booking was not yet available, my officemate booked a ticket for our boss and it was delivered without a jacket. Feeling ingenious and wanting to present the ticket complete with a jacket, she made one herself. She put it on top of our boss’ table with a label: PLAIN TICKET.

Lines from our famous utility personnel (UP)

1. When asked to deliver a message during Miss Tanya’s birthday:

“My wish for you, Maam Tanya Hotchkiss, Head of Strategic Branch Manager, is to continue my life.”

2. When requested to tour a visitor around the office:

“Good morning, sir. I am your tourist destination today.”

3. When serving a birthday cake to officemates:

UP: Want to cake everyone?

OFFICEMATE: What’s that?

UP: She’s a cake!

OFFICEMATE: Yes! What kind of cake?

UP: She is a banana cake!

4. When campaigning as PTA President:

“If I win ash president… I will project every parents with Cantilan Bank MONEYCARD so that we will use the ATM every day. Yeah, yeah!”

You think you’re dyslexic? Consider the following mixed–up, misused words:

Nag-grave lagi ko ug mangga (crave)

Nice akong shoes, uy! Conscious ba?! (obvious)

Of course, gusto gyud nako ma center of action sa party. (center of attraction)

Hala! daghan na diay balay sa Cantilan nga naay overpass? (rooftop)

Ka-cute sa inyong tanum nga cockroach! (cactus)

Dire lang ta molakaw sa may jaywalking aron iwas sa disgrasya. (pedestrian lane)

Grabe sad ka normal sa iyong family mag dinner, with table arrangement man gyud! (formal)

Looy lagi! Fify-fifty na gyud to iyang tatay kay gisulod na gud sa CPU. (ICU)

One of the characteristics of a mammal is that it has a mama mary gland. (mammary gland)

During Christmas, we distributed gifts to no parents children. (orphans)

Compatible gyud ko ani nga shoes. (comfortable)

Daku raba gyud ang bayad sa exist baggage. (excess baggage)

Dili na mi magdugay. Mouli ra dayon mi kay igo ra man pud mi nag-over drop. (drop by)

GNL, CLD

If you have any funny anecdotes or jokes that you want to share to the readers of the CBI Newsletter, send them in to [email protected].



CBI is now in the VisayasBy: Grace Naumi Lim

Cantilan Bank, Inc., the leading rural bank in the Caraga region, opened its 18th full-service branch in Sogod, Southern Leyte to cater to its fast-growing clientele. The new branch located on Osmeña Street was inaugurated on Monday, March 18, 2013.

Cantilan Bank (CBI) is a community bank that offers a wide range of financial products and services through its network of branches that are strategically located across Caraga, Compostela Valley, Davao City, Davao del Norte, and now the Visayas.

“Sogod is the logical first step in the bank’s expansion in the Visayas region considering its dynamic commercial activity and fast-growing economy,” said Raul Urbiztondo, CBI General Manager. “I am extremely positive with this latest development.” Sogod is strategically located at a crossroads between Visayas and Mindanao and CBI views its presence in this municipality a key component in its strategic expansion and entry into a new market place.

At the inaugural ceremony, CBI Executive VP and acting President, Brig. Gen. Charles Y. Hotchkiss, said, “As a community bank, we endeavor to provide a more inclusive financial system by reaching out to people in remote areas and providing access to financial services including financial education for the under-banked and unbanked segments of society.”

“Our company’s mission,” he further stressed, “which is that of providing banking and countryside development services, will definitely create a positive impact in the economy and the livelihood of the communities where we operate.”

The new Cantilan Bank branch in Sogod, the bank’s first in the Visayas, is managed by Frederick Ong who most recently served

Cantilan Bank’s customers out of the Alegria, Surigao del Norte office. This full-service branch will offer a comprehensive selection of financial solutions which have been tailored for both individual and business customers to meet their banking requirements that match their budgets and financial goals. Cantilan Bank’s full range of rural banking services including loans, deposit products, savings and checking accounts, and microfinance will be backed by a team of professionals with excellent customer service.

Customers of Cantilan Bank can visit the new branch from Monday to Friday, 8:00 a.m. to 3:00 p.m.

About Cantilan Bank

Cantilan Bank, Inc. was established in 1980 and is presently considered as one of the top rural banks in the country with total resources of P1.46B. For two years in a row, CBI was a recipient of the Landbank awards for Most Outstanding Rural Bank in Caraga and the country’s Second Most Outstanding Rural Bank. For more information on Cantilan Bank, visit www.cantilanbank.com.

2nd Cantilan Bank Tennis Cup

As part of the bank’s 32nd anniversary celebration, CBI held the 2nd CANTILAN Bank Tennis Cup on June 9-10, 2012 at the Cantilan Lawn Tennis Courts in Cantilan, Surigao del Sur.

CarCanMadCarLan Lawn Tennis

Association (CALTA) successfully defended its title after beating the Tandag Capitol Tennis Club, winning four out of five categories in the finals. Surigao City’s San Nicolas Centre Court Tennis Club was third. Top three teams got a trophy and cash prizes of P25,000, P15,000, and P10,000 pesos, respectively. Consolation prizes worth P5,000 were given to Claver-Bacuag-Placer Team and Lianga Tennis Club. ABC

Are you a salary taker or a salary maker?

Board of DirectorsLt. Gen. William K. Hotchkiss III — ChairmanWenceslao R. Arreza — Vice Chairman

Lolita R. Corcuera, Alan Y. Hotchkiss, Brig. Gen. Charles Y. Hotchkiss, Rolando U. Julve, Ramon A. Millan

Public RelationsFor inquiries, comments, and suggestions, email us at [email protected].

Cantilan Bank (A Rural Bank)Orozco St., Bgy. MagosilomCantilan, Surigao del Sur

This newsletter and its content is copyright of © Cantilan Bank, Inc. (A Rural Bank) 2013.

Words of WisdomA leader is best when people barely know he exists, when

his work is done, his aim fulfilled, they will say: we

did it ourselves. Lao Tzu

SALARY TAKERS

What will I receive?What will it take to get by?It’s not my job.

Someone else is responsible.How can I look good?Will it pass? The paycheck is the reason why I work.

SALARY MAKERS

What can I give?I’ll do whatever it takes to get it right.Whatever the job, I can help you.I’m responsible.

How can the team look good?Is it my best?The paycheck is a by-product of my work.

CBI EVP Brig. Gen. Charles Y. Hotchkiss with guests, Bobby Andrews (center), Sogod Municipal Administrator Martin Lagmay (left), and Monsignor Nestor S. Astillo, at the ribbon-cutting ceremony of the inauguration of the Sogod Branch.
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