High consumer risk and slow loan demand keep Philippine banks off lending to retail clients
Most Philippine banks are still slow on growing their lending portfolio due to only gradually improving risk management and collection abilities and slow demand for consumer loans. November 08, 2011 | Research*This article is an extract from an incisive 15-page research report on Philippine bank lending to retail clients, including 10 charts and diagrams. Download the entire report at the bottom of this page. Retail banking in the Philippines is dominated by five large banking groups BDO, BPI, Metrobank, Philippine National Bank (PNB), and Unionbank of the Philippines (UBP). A few smaller players dominate certain business lines, such as Citibank and HSBC in the credit card business and Landbank of the Philippines (LBP) in the microfinance business. The five large banks are concentrated in the Metro Manila Area, while rural banks and LBP cater to the rural areas. Figure 1. Market share of retail loans and retail deposits in the Philippines Please click to view enlarged image
BDO maintains its rapid growth trajectory, driven by mergers and acquisitions, but also fast loan and deposit growth. This resulted in an estimated market share gain of 4.3 percentage points (pp) for retail loans and 2.2pp for retail deposits. However with the lack of disclosure of retail-specific numbers, these are estimates only. The other large banks in the Philippines, Metrobank and BPI, have also expanded their market share but cannot hold pace with BDO particularly in terms of lending. Metrobank sees itself as the market leader in low cost deposits which account for around 50% of its deposits. BDO’s strategy to attract deposits and encourage savings by including balances over $1000 on its CASA accounts to earn points for its loyalty programme. Please login to read the complete article. If you already have an account, you can login now or subscribe/register.
Categories: Bancassurance, Cards, Deposits and Liabilities, Mortgage, Philippines, Retail BankingBancassurance,Cards,Deposits and Liabilities,Mortgage,Philippines,retail, Bancassurance,Cards,Deposits and Liabilities,Mortgage,Philippines,Retail Banking, Keywords:BDO, BPI, Metrobank, Philippine National Bank, Unionbank Of The Philippines, Market Share BDO, BPI, Metrobank, Philippine National Bank, Unionbank of the Philippines, Market Share
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