BPI banking on 12% loan growth

MANILA, Philippines — Ayala-led Bank of the Philippine Islands (BPI) is bullish on the growth of its loan portfolio this year, banking on the strong demand from its consumer segment.

BPI president and CEO Jose Teodoro Limcaoco on Tuesday said they expected a 12-percent growth in their loan book this year despite prolonged high-interest rates.

“The consumer [segment] remains fairly resilient. We’re continuing to see very strong growth along those segments and I think that’s the reason why our income was quite healthy,” Limcaoco said during a media briefing.

The banking giant saw record-high first-quarter earnings, growing by 25.8 percent to P15.3 billion.

Maria Cristina Go, BPI head of consumer banking, said that while interest rates would “remain higher for longer, we’ve seen the consumer segment grow quite impressively, which means there’s a lot of consumer confidence.”

Record profit of P15.3B

The Bangko Sentral ng Pilipinas is expected to maintain high-interest rates until the latter part of the year, possibly only cutting policy rates in the first quarter of 2025.

Despite this, the Zobel family-led bank has already seen an improvement in its loan releases in the January to March period.

According to Go, auto loans grew by 30 percent, while housing loans went up by 50 percent during the quarter.

“People are starting to draw down and pay the bigger amounts that have been largely postponed in the past,” she said.

While granting more loans also meant taking on more risk, Limcaoco noted that it all boiled down to how the bank managed its operating expenses.

“The big banks are more profitable from a return on equity point of view, and that’s because of scale. We keep our operating expenses relatively controlled versus revenues,” he said.

BPI’s total operating expenses in the first quarter of the year went up by 19.6 percent to P18 billion on higher spending on manpower, technology, marketing campaigns, and transaction-related processing fees.

However, BPI explained this was offset by higher revenues, which rose by 24.6 percent to P39.5 billion.

Its total assets likewise grew by 14.7 percent to P3.1 trillion. Deposits, meanwhile, reached P2.4 trillion, up by 12.8 percent. —Meg J. Adonis INQ