BANK of the Philippine Islands (BPI) is bullish on its consumer banking business and expects its loan portfolio to continue to grow despite rising interest rates due to aflation.
“We see the economy mobilizing and we see it in our loan releases on the consumer side,” consumer banking chief and BPI executive vice president Maria Cristina “Ginbee” L. Go said Monday during of a virtual briefing.
Ms Go said BPI’s regular home loan releases were 48% higher than last year. She added that the bank’s auto loan releases increased by 29%.
“These allow us to provide greater traction in the coming months as we continue to monitor the impact of interest rates on our lending portfolios. interest will drastically alter demand,” she added.
“I think we have to be careful with inflation… We have to look at where interest rates might go to fight inflation,” the BPI chairman and CEO said.ffisays cer Jose Teodoro K. Limcaoco.
“We maintain a very conservative stance here at BPI. We are not reducing our provisioning which we started at the beginning of the year. We will continue to maintain this pace,” Mr. Limcaoco added.
The Bangko Sentral ng Pilipinas (BSP) has raised its benchmark interest rates by a total of 125 basis points (bps) so far this year, as inflation remains high.
BSP Governor Felipe M. Medalla last week signaled a rise of 25 or 50 basis points at their August 18 meeting, although he ruled out another off-cycle increase. The central bank raised rates by 75 basis points in a surprise move on July 14.
Headline inflation hit a nearly four-year high of 6.1% in June, IfH1 average of 4.4%, above BSP’s 2-4% target and 5% forecast for the year.
The BSP expects the July reading to be between 5.6 and 6.4 percent. July inflration data will be released on Friday.
Meanwhile, BPI said it spent around 9 billion pesos on technology in 2021, which included digital initiatives such as building customer engagement platforms and investments in cybersecurity.
Ayala-led bank continues to focus on digitization, customer obsession and sustainability efforts as he turns 171st year in the country this month, officials said on Monday.
“As a pioneer bank in the Philippines and Southeast Asia, BPI has developed a long and rich history of banking excellence. This speaks to our unwavering commitment to maintaining the deep trust our customers place in us by being prudent, innovative and caring,” Mr. Limcaoco said.
“We also continue to adapt in order to meet the changing needs of our customers and the demands of an evolving economy,” he added.
BPI’s executive vice president and chief operating officer, Ramon L. Jocson, said the bank’s spending on cybersecurity accounts for about 10% of its technology budget.
“We spend a lot on cybersecurity as it is a growing concern for us given the increase in malware introductions into the system. The second reason is that with the adoption of technology, we see more customers who can potentially be victims,” Mr. Jocson said.
In 2021, 4.9 million of its 8.46 million customers were registered on the bank’s digital channels.
BPI’s net profit rose 82.9 percent to 12.5 billion pesos in the second quarter from 6.8 billion pesos in the same period last year. This brought the lender’s net profit for the first half of the year to 20.4 billion pesos.
Shares of the Ayala-led lender fell 2.95P or 3.17% to close at 90.05P each on Monday. — KB Ta-asan