MANILA, Philippines — The banking arm of diversified conglomerate San Miguel Corp. (SMC) is eyeing double-digit growth in loan disbursements as it expects the economic rebound to gain more strength this year.
Bank of Commerce President and CEO Michelangelo Aguilar told shareholders at their annual meeting that the listed bank would continue to increase its accrual income to help improve its credit growth.
Aguilar said the bank would also focus on fee income from its trust and trade finance businesses, and currency flows, as well as continuing campaigns to sell and reduce its stockpiles of seized assets.
Bank of Commerce reported a more than 50% rise in net profit to a seven-year high of 1.2 billion pesos last year despite challenges posed by the ongoing global health crisis.
His basic income has increased thanks to the 6% increase in net interest income. This is explained by careful management of interest charges at 697 million pesos, 41% less than last year.
Similarly, non-interest income was P826 million, fueled by double-digit increases of 19% in service charges, commissions and gains on the sale of acquired assets.
The bank’s total assets increased by 17% to reach 199.7 billion pesos, mainly due to increased purchases of investment securities. The 15% increase in deposits to 172 billion pesos also supported asset growth.
Aguilar said Bank of Commerce also plans to launch its first investment banking deals this year.
The bank expects the country’s gross domestic product (GDP) growth to be between 5% and 7% this year, as the country emerged from the pandemic-induced recession with a 5.7% expansion last year. , compared to a contraction of 9.6% in 2020.
Bank of Commerce also sees Bangko Sentral ng Pilipinas (BSP) interest rates rise to 2.5% this year from an all-time low of 2%.
He expects remittances from Filipino workers abroad to steadily recover as the global economy reopens.
“By putting them in the right context, we set out to overcome the challenges and maximize the opportunities that 2022 presents,” Aguilar said.
SMC, through SMC Equivest Corp., has invested an additional 5.5 billion pesos in the bank to boost efforts to upgrade from a commercial bank to a universal bank.
Bank of Commerce successfully raised 3.36 billion pesos in an initial public offering. Proceeds from the fundraising activity will be used to finance the bank’s lending activities and capital expenditure needs related to the modernization of its ATM fleet and central banking system.