PH banks in good shape, says COL

Troubles in the US banking sector are weighing on stock market sentiments for local lenders, which were supposed to be a safe bet in 2023 on expectations that rising interest rates would boost profitability from their robust loan portfolios.

But the collapse of US lenders Silicon Valley Bank and Signature Bank set off a wave of worry across the globe and local banking stocks were not spared from the selloff.

As investors rethink their current portfolios, leading online stockbrokerage house COL Financial Group noted that concerns were so far overblown and domestic banks were more than adequately capitalized and have ample liquidity, partly thanks to financial market reforms that were implemented in the wake of the 2008 global financial crisis.

It said banking stocks remain buying opportunities should prices slide further.

“Once volatility diminishes, Philippine stocks should recover faster since local companies’ profitability and balance sheet are expected to remain healthy even with the prevailing challenges,” it said. INQ