Philippines: BPI sees rebound in consumer loans

MANILA, Philippines — Ayala-owned Bank of the Philippine Islands (BPI) expects its consumer loan portfolio to expand this year on the back of an anticipated growth in consumption with the economy’s reopening.

BPI executive vice president and consumer banking head Maria Cristina Go yesterday said the bank projects consumer borrowings to drive its loan growth in 2022.

“In terms of loan growth, we are aligned with the BPI outlook of about five to seven percent this year. By our estimates, we will see consumer loan growth while corporate loans will continue to be muted. Nevertheless, we are looking at this same growth in our loan books,” Go said.

Go attributed the forecast to the rising mobility of Filipinos now that the Philippines is nearing to hit the target of vaccinating 70 percent of the population to achieve herd immunity.

Likewise, Go said the country managed to overturn the setback it went through from the spread of the Omicron variant in January. Authorities are even looking at downgrading Metro Manila to Alert Level 1 by as early as March.

Further, Go said the Bangko Sentral ng Pilipinas (BSP) has maintained the benchmark rate at a record low of two percent to the benefit of borrowers planning to acquire new loans.

“We have seen also BSP’s signal that they are very much aware that we are still in the recovery phase,” the BPI executive said.

“The central bank has expressed willingness to stay patient while making necessary adjustment in policy rates if the growth trajectory shows enough traction and inflationary expectations are no longer within boundaries,” she added.

Last week the BSP decided to keep interest rates untouched to support economic recovery from losses incurred during the pandemic. However, the central bank warned that monetary policies may need to be adjusted soon due to the risks posed by rising global oil prices to inflation.

Go said rate hikes can only do so much in affecting the availability of credit, as banks like BPI assess their asset quality and rearrange their loan books every now and then.