The Metropolitan Bank and Trust Co. (Metrobank), second largest by assets, on Wednesday projected loans growing faster than 23 percent this year on the basis of a fast-expanding agribusiness sector and greater purchasing power in the countryside.
This was learned from executives meeting financial reporters, who remained confident of exceeding loan growth of only 23 percent last year, as agricultural ventures are driven by heightened infrastructure spending and interest in real estate this time around.
Executives also planned to hire more people this year and cut down on branch expansion.
The bank plans more manpower beyond the 80-percent growth it posted last year to 959 branches, of which 55 percent are in rural areas.
“According to our research, the growth of SMEs [small- and medium-sized enterprises] surrounding our branches reached 22 percent, because we had more people meeting the clients,” said Mary Mylene A. Caparas, executive vice president at Metrobank.
Its branches were to grow a mere 10 percent this year.
“We are starting to reap the benefits we invested in hiring more people. We are focusing on capacity building people through training and hiring the right people. We even changed the metrics to include these people. So, we know what to push,” Caparas said.
The bank will concentrate efforts on financing more agribusinesses amid the government’s aggressive infrastructure spending.
“Logistics is also growing because if you provide accessibility further down, the goods are brought up to where houses are being built,” Caparas said.
Based on the Philippine Development Plan of 2017 to 2022, the Mindanao Logistics Infrastructure Network program has started developing 477 kilometers of the total 2,206 km roads and bridges in the remote parts of the country.
The executives believe the resulting increased connectivity of business operations in the countryside should draw net interest income higher than its 8.11-percent growth in the first quarter this year.
Despite the proposal by the Asean to draft an application framework for qualified Asian banks for purposes of economic integration, Metrobank remains focused on the local market.
“We are focused on the domestic market, especially in the countryside. The consumption also comes from agribusinesses in the countryside, especially on food. Thus, the downstream sector is where the banks could help, as the government has its own infrastructure spending” said Marc Bautista, Metrobank’s head of Research Department.
Bautista noted the P8.4-trillion-budget for infrastructure under the Duterte administration compared to only P1-trillion spending under former President Benigno S. Aquino III.
The easy liquidity enjoyed by Filipinos, especially the families of overseas Filipino workers, boosted by the recent depreciation of the peso, ensures more opportunities for loans in the countryside.
“The depreciation of the peso indicates more robust spending because there will be more [domestic] demand and exports. The weakened peso also gives more purchasing power to overseas workers through the remittances that generate a lot of investments. It is a sign that we are, in fact, growing,” Bautista said.