More banks see robust growth this year

More bank presidents and chief executive officers are maintaining a double-digit growth in the industry’s profits, assets, deposits and loans this year, according to results of the latest Banking Sector Outlook Survey (BSOS) of the Bangko Sentral ng Pilipinas (BSP).

The survey conducted by the BSP’s supervisory policy and research department showed that 88 percent of the respondents for the first semester expect a double-digit net income growth for the next two years, higher than the 83.3 percent during the first semester of last year.

“The banks’ optimism on the economy and the bullish operational projections likewise elicited upbeat expectations,” the central bank said.

Around 90 percent of big- and mid-sized banks expect a doubledigit net income growth, while only 76.9 percent of small banks see a double-digit profit growth.

More specifically, around 30 percent of universal and commercial, thrift, and foreign banks projected net income to grow between 10 percent and 15 percent over the next two years.

Foreign banks’ projections were fairly distributed during the current survey compared to the maiden BSOS when 54.2 percent of foreign bank respondents projected net income to grow by more than 30 percent.

The banking industry remained optimistic about their net income amid the projected tighter net interest margin with 44.9 percent of the respondents expecting a margin of less than three percent and 23.1 percent forecasting a margin of between three and five percent.

“Evidently, the improved net income projections were not affected by the tighter projections for the banks’ net interest margin,” the BSP said.

About 49 percent of the total respondents sees a return on equity (ROE) between five and 10 percent, while only 13.8 percent project ROE at less than five percent.

Latest data from the central bank showed the nine-month profit of Philippine banks grew by 29 percent to P169.46 billion from a year-ago level of P131.53 billion.