PNB gears up SME lending, IT upgrade

Philippine National Bank (PNB) is increasing its foothold in the SME lending business, IT and banking digitalization to cement its position as top bank especially in the countryside.

The Lucio Tan Group-controlled bank is spending R1.7 billion alone to enhance its IT and cyber security controls this year, and it’s half of its R3.5 billion capital expenditures.

Executive vice president Horacio E. Cebrero III of the PNB treasury group told reporters yesterday they expect to keep its strong growth this year or double-digit, mirroring its 2016 profit increase of 14 percent to R7.2 billion.

The bank will release its first quarter net income results in two weeks but Cebrero hinted that the numbers are positive.

For 2017, he sees several challenges to ensure they keep the momentum of last year’s growth intact. Among these is how to watch out for the uncertainties in the market which could be different or the same from that of last year’s volatility issues.

“It’s more uncertainties … we‘re trying to take out certain noises (on these uncertainties) and what are the signals. The interest rates (will get) higher and the main challenge for the bankers for 2017. We know it’s going up but how fast is it going up (we’re not sure),” said Cebrero.

He added that the geopolitcal issues is another uncertainty as it will affect PNB’s businesses. “Also political concerns. We have to put that in the equation as we craft strategies that we will implement.”

Executive vice president for institutional banking Cenon C. Audencial Jr. said there are plenty of opportunities for the bank in 2017 particularly on the commercial lending side.

“We’ve been very active in the PPP for one thing, in past three to four years. Also LGU projects and we have identified credit worthy contractors in the countryside in funding their needs,” said Audential. “We’ve actively particpated in PPP and we are coordinating with DPWH and other government agencies in the rollout of their infra projects worth R850 billion this year.”

PNB is top five of the biggest unibanks in the country. About 35 percent of capital expenditures are set aside for branch network expansion and the focus this year is on growing its SME lending. They are putting up at least 10 branches to boost its SME lending alone.

PNB Savings Bank president Jovencio B. Hernandez said at the moment, of its more than R30 billion loan portfolio, SME lending only contribute about 13 percent. In peso value, this is about R2 billion which was low.