State-owned MiBank will become a third commercial bank in the country if Kina Bank acquires Westpac.

Prime Minister James Marape revealed this in Parliament today in a response to series of questions.

The bank is a subsidary of National Development Bank (NDB).

Yangoru-Saussia MP, Richard Maru asked PM Marape about Kina Bank’s proposal to buy out Westpac (PNG).

Maru warns the proposed acquisition if materilised would diminish competition among banks.

Mr Maru said whether Government had supported TISA Savings and Loan Society’s bid to secure a banking license and its plans for the NDB.

Answering the questions, PM Marape said he was aware that Kina Bank wanted to buy out Westpac (PNG).

However, he said the Independent Consumer and Competition Commission (ICCC) has warned against decreased competition in the banking sector.

He said what Kina Bank and Westpac (PNG) were doing was a private business arrangement.

Thus, the Government, he said, has little say in, and for which the ICCC was doing its job.

PM Marape said to ensure that competition existed in the banking sector, his Government was encouraging new commercial banks to emerge.

“We are supporting NDB to reform, and for MiBank to emerge as a commercial bank to fill in the void that exists.  We have limited banks in our country,” he said.

“Government, in as far as our responsibility is concerned, will encourage NDB to step up.”

PM Marape said there would be changes at board and management level at NDB as it prepared to move into commercial banking.

He encouraged Westpac to remain in the country.

His encouragement comes in light of the economy projected to grow over the next five years. That is through increased benefits from PNG LNG, Papua LNG, Wafi-Golpu and the new Porgera.

“If they (Westpac) decide to completely sell out, and walk out from our country, then something within our control is the NDB,” he said.

“We’re preparing NDB to step up to fill in this vacuum.”

TALKS ON THIRD BANK

PM Marape said he was aware of “crowd funding” being mobilised by Papua new Guineans to set up a commercial bank.

Also, he said he was was aware of interest by TISA, which his Government fully supported.

“We are a nation of possibly 10 million people,” he said,

“Our GDP is K80, K90, K100 million which will grow into the future.

“There is space for a third bank, a fourth bank, in our country.

“We want locals to participate in this space.”