HSBC expects double-digit income growth

HSBC is optimistic of a double-digit growth in net income this year in its Philippine operations, a top bank official said.

Walter Manning, HSBC Philippines president and chief executive officer, said a double-digit growth rate is achievable this year although none of its revenue activities would make any spectacular growth rates.

In 2004, HSBC Philippines recorded a P1.3-billion net income.

"Consumer banking activities will register the biggest growth rate this year but it is too early to tell which (of the banking activities) would contribute the biggest to the bottonlime," Manning added.

Other areas that are expected to make significant contributions are in the credit card market, wholesale and retail lending, treasury, custodianship, and personal banking activities.

During the formal festivities marking the bank’s 130th founding anniversary, HSBC officials see positive albeit conservative growth since the Philippine economy is likewise seen to grow by a mere four to 4.7 percent.

Consumer banking activities will make the biggest contribution in terms of earnings as HSBC Savings Bank finally starts making positive contributions. After struggling for nearly two years, the savings bank registered seven straight months of positive earnings mainly in consumer banking.

"Consumer banking will make at least a 10-percent contribution in terms of earnings to the Philippine operations," officials said.

Last July, its credit card operations hit a company record. In 2005 alone, it issued a record 98,000.

"We have already recorded the highest growth rate in the industry reaching 25.2 percent in the first half of the year," Martin Cook, HSBC deputy chief executive officer said. If the trend will remain consistent, that is, higher sales of cards in the second semester over the first, HSBC officials are anxious that the Philippine card operations could achieve record levels.

The industry annual average was placed at 7.8 percent, while card issuers note trends of higher issuances in the second semester particularly due to Christmas buying. In fact, 60 percent of its personnel in the consumer market business is concentrated in the card business.