August 5th marked a historic moment for Papua New Guinea's financial sector as the Bank of Papua New Guinea (BPNG) issued commercial banking licenses to TISA Bank Limited and Credit Bank PNG Limited.
This event, held at the BPNG headquarters in Port Moresby, is the first time two banking licenses have been granted on the same day, signaling a significant advancement in the PNG’s banking sector.
Governor Elizabeth Genia of BPNG officiated the event, stating: “It is my great pleasure to confirm that the Bank of Papua New Guinea has issued each with a commercial banking license today. Our hearty congratulations to PNG's new commercial banks, TISA Bank Limited and Credit Bank PNG Limited.”
The announcement coincided with BPNG's 50th anniversary, adding to the significance of the occasion.
Governor Genia highlighted the positive impact of increased competition for Papua New Guineans. BPNG, she said, will continue to provide regulatory support to both new banks, ensuring they meet the necessary standards.
“For the financial system to be strong and vigorous, we need more service providers to foster real competition,” she noted. “BPNG actively supports reputable new entrants into the commercial banking market.”
The banking sector in PNG has faced challenges in recent years, with some banks closing operations or shifting strategies, leading to fewer retail banking options and a concentration of market share. However, the licensing of TISA Bank and Credit Bank PNG is expected to reverse this trend.
Governor Genia expressed optimism that increased competition would benefit consumers through more choices, innovative solutions, and better fee structures.
Dr. Albert Mellam, Chairman of Credit Corporation (PNG) Limited, reflected on the significance of the moment, stating: “Since we commenced operation in 1978, it has been a dream of our founding directors for Credit Corporation PNG to become a bank one day. Today, that dream is realized.”
He also outlined new services that Credit Bank PNG will offer, including internet banking and mobile applications tailored toward small to medium enterprises and emerging markets.
The rigorous two-year assessment process conducted by BPNG ensured that both TISA Bank Limited and Credit Bank PNG Limited met stringent requirements to operate as commercial banks, including governance, risk management, financial health, and operational systems.
Governor Genia reiterated that obtaining a banking license is just the beginning. Ongoing compliance with the Banks and Financial Institutions Act 2000 and other regulations is crucial for these banks’ continued operation.
TISA, a key player in the savings and loans industry since 1972, also celebrated this milestone, as its Chairman Gabriel Tai emphasized the bank's commitment to adhering to BPNG's regulations and serving its 80,000 members across Papua New Guinea.
“TISA Bank is for everybody in Papua New Guinea,” Tai stated, underscoring the bank’s inclusive approach that aims to provide services to a broad range of customers, including SMEs and MSMEs.
These new bank entrants are expected to create jobs, promote financial inclusion, support local small and medium-sized enterprises (SMEs) and micro, small, and medium-sized enterprises (MSMEs), and drive innovation within the sector.
