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SECURITY Bank Corp. (SBC) said its corporate lending business is
expected to post a modest expansion this year as the country’s
economic growth will slow down.
In a briefing, Carlos Borromeo, SBC chief
financial officer, said corporate lending is expected to grow 10
percent this year, and account for 60 percent of the bank’s total
loan portfolio.
A medium-sized commercial bank, SBC expects
credit demand from the mining, tourism, property, energy and
transportation sectors this year.
Besides the corporate market, the lender also
caters to the middle-income segment, which is 32 percent of the
total loan portfolio, Borromeo said. The bank’s consumer market,
mainly the credit card business, accounted for another 18 percent.
“The bank’s growth will be coming mainly
from corporate lending and very small from the consumer sector,”
Borromeo said.
SBC will put up five more branches this year to
boost its corporate lending business.
It recently opened its new branch in Mandaue,
Cebu and will establish four new branches in Wack-Wack, Mandaluyong;
Laoag, Ilocos Norte; Urdaneta, Pangasinan; and Cagayan de Oro.
“Oil price increases and global food
supply concerns have tempered the outlook for the Philippine economy
of 6 percent versus last year’s 30-year high of 7.3 percent,”
Borromeo said.
The central bank expects the country’s
economic growth to reach 6 percent this year if increases in oil
prices will average $125 per barrel this year.
“It’s [credit expansion] not that gloomy
this year [but] it’s going to be a tough year,” Borromeo said.
SBC’s net income for the first quarter grew by 10.3 percent to
P835.7 million.
The executive said the bank could post a
double-digit growth this year but would be slower compared with the
42-percent expansion last year.
Its net income increased to P2.7 billion in 2007
from P1.899 billion in 2006 driven by higher revenues, which grew 20
percent to P7.9 billion.
The bank’s loan portfolio increased
significantly last year due to a low interest rate environment. Its
total loans jumped by 55 percent to P52 billion on higher demand
from infrastructure, utilities and real estate development.
The bank had a capital adequacy ratio of 14.5
percent, higher than the regulatory minimum of 10 percent. SBC is
exploring how to finance its P3 billion lower tier 2 fixed rate
subordinated notes callable in January next year.
Its assets expanded to P128.648 billion last
year from P122.480 billion in the previous year.
-- Maricel E. Burgonio
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