PSBank eyes double-digit rise in loan portfolio, higher profit

PHILIPPINE Savings Bank, the thrift bank arm of the Metrobank group, hopes to end this year with a net profit exceeding the P2.3-billion full-year earnings posted last year.

Robust growth in auto lending—which accounts for about 40 percent of the bank’s total business—is seen to remain a key growth driver through next year, PSBank Vicente R. Cuna Jr. said in an interview on Wednesday.

About 90 percent of PSBank’s lending business comes from lending to consumers and households, particularly auto and mortgage lending. Some 10 percent represents lending to small and medium enterprises (SMEs).

Cuna said PSBank was expecting to sustain a double-digit expansion in its loan portfolio in 2016.

In the first nine months of this year, PSbank’s gross loan portfolio went up by 17.6 percent year-on-year to P111.8 billion, led by the robust growth in auto and mortgage loans.

In terms of net profit, Cuna said: “We hope to exceed last year.”

The bank’s P2.3-billion net profit last year marked a 21-percent decline from the level in the previous year due to the absence of extraordinary trading gains which were present in 2013.  However, the bank’s core margins in 2014 grew by 15 percent due to the continued growth in its consumer loan portfolio.

In the first nine months of this year, PSBank posted a net income of P1.73 billion, 7.59 percent lower than the P1.88 billion recorded in the same period last year.

Cuna said PSBank would focus on three things next year: expanding customer base, solidifying franchise in the consumer space and enhacing overall customer experience.

At present, PSBank has a customer base of nearly half a million.  The bank expects to end the year with 248 branches and over 600 automated teller machines.

The bank is also building its mobile banking capabilities as part of a strategy to enhance customer experience.

On future fund-raising requirements, PSBank sees no need to raise fresh capital at present. In 2017, some P3 billion in tier 2 or subordinated debt notes will mature. Cuna said a decision had yet to be made on whether to refinance.

The bank’s capital adequacy ratio (CAR) is currently at 17 percent while core or tier 1 is above 12 percent, both exceeding regulatory requirements. Doris Dumlao-Abadilla