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AUGUSTO M. BARCELON (1922-2004) - A tribute to ‘Barcy’
By C.L. Panlilio
The Philippine Star 08/17/2004

The Philippine banking world may never be the same again after Augusto M. Barcelon. He was, indeed – as many of his peers and colleagues can attest to – a venerable pillar whose recent passing has left many bereft of his exemplary driving force and impeccable leadership.

Except for Wilfrido Tecson, founder of then Solid Bank, all six other "horsemen" of Filipino banking are deceased now. They were in the 60s and 70s also referred to as the "Magnificent 7," for their sterling leadership in banking at the height of the restructuring of the General Banking Act during President Marcos’ tumultuous pre-martial law administration.

There was Chester Babst, founder of then Pacific Bank, Jose B. Fernandez, founder of then Far East Bank; Alberto Villa-Abrille Sr., head of the ever-stable Bank of the Philippine Islands; Go Kim Pah, founder of Equitable Bank; Edgardo Kalaw, founder of the merged IBAA; and last but not least, Augusto M. Barcelon, considered by many as banker primus interpares of his generation.

Barcelon’s colorful banking career goes back to 1954 when he co-founded the then Commercial Bank and Trust Co. (Comtrust). The bank, which was one of the first commercial banks established by Filipinos, thrived on the principle that not a single major shareholder would control it. It soon became, by the mid-60s, one of the top five Filipino-owned banks, sprouting branches in the then growing suburban communities of Metro Manila. In 1981, Comtrust was deemed a good buy and acquired by the country’s top bank, Bank of the Philippine Islands (BPI).

Having seen how investment banking had become the trigger and catalyst to the enormous economic growth of other developed countries, Barcelon in 1966, opened the doors of Bancom Development Corp. to the more aggressive and enterprising businessmen and industrialists of the Philippines.

With him as chairman and Sixto K. Roxas III as president, Bancom – a joint venture between Comtrust and Bankers Trust of New York – had blossomed into a giant but sophisticated investment banking institution. With its astounding success tagged as the "Bancom mystique," the company innovated the institutionalized money market operation and the "commercial paper" instrument which was considered a first in the world.

Barcelon also marshalled the company’s rapid pioneering and expansion in the ASEAN region during the ’70s. While all Filipino bankers were still too preoccupied with the local market, Barcelon had pushed his people to Indonesia, Malaysia, Thailand and Hong Kong where they had met equal success. The company even planted its flag in California through a commercial bank subsidiary there.

After a falling out with Comtrust in 1969, Barcelon towed his already famous Bancom to RCBC and then, in 1974, to Far East Bank. This latter strategic merger brought two of the country’s most dynamic bankers – Jose B. Fernandez as chairman and Barcelon as president – under one roof. Far East Bank had been become the repository of time-tested business wisdom, prudent aggressiveness, marketing savvy and innovative banking strategies. In a short span, it had become the third largest Filipino private bank.

In 1981, Barcelon, at age 58, retired from Far East Bank to concentrate on overseeing his other investments in the food, banana, steel and realty industries while retaining the chairmanship of Bancom. It was, however, a brief retirement for shortly, the grave impact of the Dewey Dee caper in the same year badly affected all the investment banks and weak commercial banks in the country. Investment banks, whose lifeblood was the money market operations, started to suffer runs and not even the giant Bancom nor Ayala Corp.’s investment house, AIDC, could withstand the panic caused by Dewey Dee’s huge unpaid loans.

Through some "financial reengineering," Barcelon deftly and skillfully steered Bancom to safe waters by converting its little-known banking subsidiary, Union Bank, into a commercial banking operation with infusion of fresh equity and long-term funding from the SSS. In no time was he the hands-on president of Union Bank which by then had absorbed all the assets and liabilities of Bancom.

Barcelon grew Union Bank to a leading financial player that it is today. He had turned it into a highly profitable bank that in the late ’80s, new investors like the Aboitiz Group and Insular Life had bought majority interest in the bank.

Outside the banking world, Barcelon ventured into other businesses/investments, the following of which are due to his initiatives and vision: pioneered the banana industry in Davao with the prominent Jose M. Tuason family, UFC Banana Catsup, Medical City Hospital, Milagros Farms, and Rizal Steel, among others.

A strong "people sense" was his endearing and enduring trait. When he gave his trust on the competence of a potential executive, he supported him by giving him a chance to execute and actualize his ideas. "The secret of growth," he once said, "is having people who can be delegated challenges and responsibilities, and can be left on their own to create their own niches in the company." Graduates of Barcelon’s astute mentorship are Chito Ayala, Manny Pangilinan, Ramon del Rosario Jr., Francisco Licuanan, OV Espiritu, Dr. Alfredo Bengzon, Josie Tan, Vicente Panlilio and many more "who’s who" in Philipine business.

Barcelon also pioneered and practiced "good governance." This underlying reality, which calls for utmost transparency, integrity and honor, is the bedrock of management and systems procedures that are innately collegial in decision-making. Barcelon and his close peers had practiced this all their professional lives; thus, he is known for his unsullied integrity and high moral standards for himself and his people.

Barcelon’s unblemished character can be attributed to his education and hard work during the early years of his career. Educated for the most part at the Ateneo de Manila in Padre Faura, he worked his way up, starting as a credit investigator at the old PNB office along Escolta. During the Japanese occupation, he managed to pursue his law studies at the M.Q. Quezon law night school and accountancy at the Far Eastern University.

He soon became Credit and Foreign Manager in PNB. He later resigned, however, and invested all his savings in co-founding Comtrust in 1954, together with a few managers from PNB.

Fondly called "Atos," his childhood pet name by relatives, and "Barcy" by his friends and peers, Barcelon is survived by his wife of 56 years, Teresita Ayala. The couple’s friends and close relatives attest that their marriage remained strong because both are endless romantics. Their union produced four accomplished children: Eddie (an investment banker), Louie (personable wife of Rep. Teddy Boy Locsin), Tessie and Binky (both businesswomen). Eight good looking grandchildren and two cuddly pugs are counted among their blessings.

Perhaps the apropos epithet for the endless dreamer and visionary that Barcelon was is to quote another banker par excellence, Jose "Jobo" Fernandez. Fernandez had started to conceptualize his own bank (Far East Bank) in 1959. By then, Barcelon’s Comtrust was already a stable and enviable five-year-old bank. Fernandez admitted that his model for the soon-to-be-born Far East Bank was Barcelon’s widely owned Comtrust. In training his first batch of soon-to-be managers, Fernandez exhorted them by yelling: "Let’s duplicate Barcy’s baby!" In life, no less than "the" Jobo Fernandez admired Barcelon. For us lesser mortals who had a rare and privileged chance to have the inimitable Augusto M. Barcelon as mentor, adviser, associate and friends, he shall, in life and in death, own our grateful admiration, ad infinitium!
The tribute briefly mentioned that one of Augusto Barcelon's protégés was Manny Pangilinan when the latter was worked as an investment banker for Bancom Development Corp. / Bankers Trust. Bancom at that timewas considered to be a gold standard in the Philippine investment banking industry.
our bank president is an alumnus of bancom and UBP at about the time of MP. he's from DLSU though.
I worked with a lot of old BANCOM alums. They were pretty sharp and taught me a lot. They have very kind words for Barcy Barcelon. They always looked upon their BANCOM days as the best of their lives. There was a feeling that anything was possible in those days. Too bad those days were numbered.
QUOTE(Maverick @ Aug 20 2004, 12:14 PM)
I worked with a lot of old BANCOM alums. They were pretty sharp and taught me a lot. They have very kind words for Barcy Barcelon. They always looked upon their BANCOM days as the best of their lives. There was a feeling that anything was possible in those days. Too bad those days were numbered.

BANCOM thrived at that time partly because they looked beyond the Philippines to do business - kind of like the way SGV provides its services across Asia. That's why they had lots of opportunities to grow even if the Philippine economy performed poorly. But they got burned after the Dewey Dee fiasco and I'm not sure if they would have survived the Asian financial crisis if they were still around.
Actually, the sixties up to the mid-seventies were still go-go years for the country. It started seriously tapering off in the late-seventies and went into crisis mode in the eighties. Whenever I asked my former superiors "if BANCOM was so good, why did you collapse?," they always had a myriad number of reasons but the Dewey Dee caper was the single common denominator. That one event signalled a banking crisis as people started terminating their money-market placements and banks called in their loans. But, even if BANCOM survived Dewey Dee, I doubt they would have survived the fallout from the Aquino Assassination.

Actually, the man who founded BANCOM is an Atenean, Sixto K. Roxas. He's in retirement now. He promises to write a book on his BANCOM days. Hope that sees print someday.
QUOTE(Maverick @ Aug 21 2004, 01:07 AM)
Whenever I asked my former superiors "if BANCOM was so good, why did you collapse?," they always had a myriad number of reasons but the Dewey Dee caper was the single common denominator. That one event signalled a banking crisis as people started terminating their money-market placements and banks called in their loans. But, even if BANCOM survived Dewey Dee, I doubt they would have survived the fallout from the Aquino Assassination. 

Actually, the man who founded BANCOM is an Atenean, Sixto K. Roxas. He's in retirement now. He promises to write a book on his BANCOM days. Hope that sees print someday.

It's not unusual for one rogue transaction/practice to bring down an entire investment house. Some of the others that come to mind are Barings, Drexel and Long Term Capital. It happens to the best of them (or maybe they weren't so good after all). I'm looking forward to Sixto Roxas' book. I hope it's as good as "Liar's Poker".
I second that, rabbaddal. Problem in the case of BANCOM was that it wasn't the wrong-doing of someone in their ranks but a completely external cause that did them in. Of course, that's what we have been led to believe. No one really has written on the cause of BANCOM's collapse. If Ting Roxas coms out with his book, I expect it to be less of Liar's Poker and more of an apologist's view of the events that led to that IH's demise.
Jaco D'Shepherd
Sixto K Roxas (SKR) and Bancom. Now that's a breath of fresh air from the glory days of Philippine business.

When Manila was THE place to be in investment and financial management, the creme of the crop of Manila's top schools as well as products of foreign MBAs either took the Citibank route or the Bancom route. The former produced, among others, the likes of Atenean/La Sallite Paeng Buenaventura of the Central Bank and Ateneans Xavier Loinaz and Gigi Montinola of BPI. The latter produced such names as First Pac's Manny Pangilinan, Anscor's Boy Blue Del Rosario (strangely enough, he's from Taft), ex Union Bankers Quinito Henson, Paquito Dizon, and a long line of sharp bank treasury officers.

Bancom was more than an investment house. They were everywhere! agriculture, banking, finance, etc. They even had a motion picture outfit that produced the infamous "The Boatman" starring then unknown actors Sarsi Emmanuel and Ronnie Lazaro. I think one of our theology profs asked the class to watch Boatman at the Manila Film Center (buhay pa ba iyon?) at the CCP complex. Of course, since we were in the area we just "had" to verify the film's content by partaking in the local color of Ermita. tongue.gif Though people made a beeline to see the movie for its dime a dozen nude scenes, I found the movie artistically well made: tight story and script, superb acting, technically sound cinematography and movie making, etc. If you have the chance of see this flick (if you can find it), see it. It's worth the time.

A stunt we finance and investment neophytes used to pull during the late 80s when we didn't have "good time" money on a Friday night was to schedule client calls late Friday afternoon with a Bancom veteran at a hotel bar. The trick was to get the serious and official stuff out of the way early in the visit (oo naman, our intentions were pure), then just when you thought the call was finished, direct the conversation towards "the Bancom days". You'd be set for the next few hours enjoying interesting war stories together with ice cold beer and top rate bar chow as Mr. Bancom veteran would either call his significant other to say he would be late or let his driver fetch the missus and just come back for him. Chances are, your Bancom veteran would be more than willing to pick the tab! wink.gif I still pulled this stunt in the mid-90s just before I let for Canada. It never failed! Have I tried this on a Citibanker? Crash and burn, my friend. I guess Bancom was a fun place to work, and Bancom vets never resisted re-living the glory days together with the unlucky generation who missed out on the action.

If there was a person who epitomized Bancom, it was SKR. Not only was he sharp like a machete, but he was cutting edge just like Bancom and the young turks that it had on its roster during its heydeys. Heck, tongues would wag everytime someone mentioned the letters S-K-R. The guy was a bohemian, an eccentric and a very colorful fella. I remember once seeing him in a well-tailored barong and dress pants with his salt and pepper nape-length hair tied down into a small ponytail. Some people found that get-up disgusting. I found it different, yet classy. His daughter briefly attended the college in the 80s and wore two hairstyles cut equally down the middle of her head - one half very feminine which my female classmates called the "layered" look (duh, how should I know?), the other half close to a skinhead. Definitely cutting-edge, and definitely a chip off the old block.

I'd love to read SKR's book once it's out. Though reading it would not get me free beer and barchow, it would be nice to hear the real thing straight from the horse's mouth.

I can totally relate to your experience with BANCOM alums. My former bosses were BANCOM alums and since a lot of the BANCOM alumni ended up running banks and financial institutions and were represented in a lot of treasury departments, we had a steady stream of business from their former colleagues. They would enjoy pointing out the BANCOM alums in whatever company and would seek out their fellow BANCOMers everytime we had a deal. In fact, I think their business connections kept our firm above water.

They never tired of telling us younger guys their old war stories. My boss would always get misty-eyed whenever we talked about his BANCOM days. That was a sure fire way to get him to break out the good scotch and brandy and to ask his secretary to order a good round of pulutan, sometimes steaks even when the subject was particularly close to his heart. Once the subject of the conversation was the cause of BANCOM's failure and the boss brought out the big guns -- Jack Daniels and all the sisig you could eat. Man, I was so plastered that Friday night, I ended up sleeping in my room and going home the next day. I think every Friday ended with some de-briefing on his BANCOM days. I never went home before midnight when the "BANCOM days" was on the agenda and, under the guise of having a meeting, would have to tell my significant other that I would be late or won't show up because the boss was in the midst of some story about how they invented commercial paper or how they applied for a loan with the IMF. Of course, there was a lot of chismis involved too like the nasty phone habits of some top-flight banking executive or how some now top finance man started out his BANCOM days shuttling back from one department to another.

There was also this other guy in the office who was worse. He always managed to interject his BANCOM experience everytime you spoke to him. Whenever we consulted him on a problem, his standard answer was "alam mo, nung nasa BANCOM pa kami..." He also seemd to keep track of every person who went to BANCOM. Everytime I reported and said that I met with so-and-so, he would say "o, taga-BANCOM dati 'yan." Which prompted me to inquire if everyone in Manila was a BANCOM alum. He replied: "Hindi naman, 'yung magagaling lang." Also, when we attended a meeting with some other BANCOM alum present, you could bet that the first thirty minutes of the meeting would be spent discussing their BANCOM days.

You're right about the "Boatman" thing. They also went into other creative and artistic endeavours like forming the first Philippine cable TV channel (Sining Makulay) and producing a Philippine culture encyclopedia (Filipino Heritage). Amazing company.

There was a time that I got to meet up with SKR on an almost weekly basis. Unlike his protegees, he was very reluctant to talk about the BANCOM days. In fact, I would even say that he was trying to avoid or forget the topic altogether. He didn't seem to be excited that I worked for BANCOM alums, which I found strange since I was accustomed to BANCOM alums getting all worked up whenever they found out that I worked with such and such. Whenever some area of the BANCOM years came up, SKR would shift the conversation to something else like wine or philosophy. I guess some experiences are better kept just bubbling below the surface.
Jaco D'Shepherd / Maverick,

Very interesting stories from the days of opulence in the investments industry. Some of my friends and colleagues who worked for those old white shoe houses like DLJ, Robertson Stephens and Bankers Trust had similar stories to tell. Nowadays, the business is cut-throat and many of the perks like bowls of fresh fruit in every floor, wood panel offices and golf trips in Scotland have all but vanished along with client loyalty and patronage.

Actually, the constant theme of all these BANCOM reminiscences did not center on the lifestyles they had but on the fact that they all had this feeling that anything was possible. The Philippines was not yet the basket case that it was in those times and was considered innovative and cutting edge by our other Asian counterparts simply because we were viewed as the most modern and western of all Asian countries. As my own father used to put it, when Filipinos travelled abroad, especially on business, everyone wanted to talk to you since compared to them, they saw us as progressive. In the case of BANCOM, they were at the cutting tip of that edge.

That's why all the BANCOM stories are so long-winded. Their experiences have attained this romantic "what could ave been," glory days long gone feel to it. BANCOM was their Camelot.
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