BPI pumps up tech brawn via P50-B boost

Ayala-led Bank of the Philippine Islands (BPI) plans to use the P50 billion from its upcoming stock rights offering to secure a “technologically strong” and “inclusive” financial backbone in the years ahead.

Within the next four to five years, BPI hopes to see the share of the higher-margin retail lending businesses to increase to 30-35 percent from 20 percent at present, BPI president Cesar Consing said in a press briefing after the bank’s stockholders meeting on Thursday.

This year alone, BPI sees its lending and deposit-taking activities sustaining a midteen pace. “While corporate book still accounts for a very significant portion of our asset base (equivalent to 20 percent), we see faster growth in high-margin businesses such as SMEs (small and medium enterprises), retail loans, particularly credit cards, auto housing and our growing microfinance business,” BPI chief financial officer Maria Theresa Javier said.

She said the bank would prioritize four areas: increasing the level of digitization, enhancing the deposit franchise and delivery infrastructure, accelerating the growth of SME and retail loans and continuing to grow the microfinance business.

Consing said “digitizing” the bank would not only mean migrating more clients to online and mobile platforms but also using technology to enhance the bank’s internal processes. “That will allow for more capacity that will reduce our unit costs. We really want a much more technologically strong and inclusive bank,” he added.

About 34-35 percent of BPI’s 8.5 million clients are now using digital platforms, twice as much as the industry-wide average.

BPI also sees ample opportunity to increase business even outside its existing customer base. It also wants to further strengthen the numbers of its BPI Direct BanKO, which focuses on self-employed microentrepreneurs, many of whom do not have access to the formal banking system.

BPI is also looking to harness agency banking, which allows it to solicit and accept deposit outside bank premises.

On prospects for 2018, Consing said the uptick in interest would help lift margins.