Publicly-listed Philippine Business Bank, the financial arm of the Yao Group of Companies, plans to increase lending by double digits this year on sustained loan demand from small and medium enterprises.
Former ambassador and bank chairman emeritus Alfredo Yao expressed optimism on the growth outlook of the industry, especially with the booming economy that could be translated into more credit to different industries.
“As far as loans, we are looking at a double-digit growth this year. Previously, most banks relied on treasury and trading gains. That was before. But now, most banks are into the back-to-basic mode, which is lending,” Yao said in a press briefing in Makati City over the weekend.
He said PBB’s loan growth could be achieved through an expected sustained demand from small and medium enterprises, the bank’s target sector since it started operations several years ago.
Yao, however,conceded that the growth of thrift banks could be challenged by bigger banks eating into the share of smaller banks when it comes to SME lending.
To widen its coverage and reach potential growth areas, Yao said the bank planned to put up 25 additional branches this year, on top of the current 148 outlets scattered nationwide.
“Most of these will be located in the provinces but we also plan to put up branches in the restricted areas in Metro Manila,” Yao said.
Yao, meanwhile, was mum on the details of the reported talks with a foreign bank for a possible partnership in the future. He said his group would “not give up the majority” if there was foreign capital infusion in the bank,
“You must read between the lines. A foreign bank [usually] comes looking at a universal bank. The first requisite of a universal bank is that it should be a listed bank, and we are a listed thrift bank,” Yao said.
He declined to say if PBB had any plan of converting into a universal bank.
PBB posted a 14-percent increase in net income to P513.4 million in the first nine months of 2015 from P449.7 million a year ago.
The bank’s pro-forma recurring core income was almost flat at ₱691.5 million against ₱690.1 million on year. The bank’s recurring net profit included earnings of Insular Savers Bank, a rural bank acquired by PBB earlier last year.
PBB finished the third quarter with ₱62.6 billion in total resources. Loans and receivables grew to ₱39.9 billion from ₱35.6 billion in end-September 2014, up 12 percent year-on-year.
Total capital grew to ₱8.4 billion as of Sept. 30, 2015, up 4.9 percent from end-2014.