MANILA, Philippines - Despite of the poor showing in earnings from lower trading gains, Philippine banks are forecast to do well in 2013, according to the top executive of the Bank of the Philippine Islands (BPI).
Likewise, BPI president and chief executive officer Cesar P. Consing believes that the rebuilding process as a result of the destruction of Typhoon Yolanda and the dozens of natural and man-made catastrophes, plus the actual construction of infrastructure-related Public-Private Partnerhsip (PPP) projects, favors strong lending in 2014.
“Ironically, the rebuilding required (for the recent devastations) might actually help the country’s economy,†Consing said during the 7th BPI Search for the 10 Outstanding Expat Pinoy Children held yesterday at the BPI head office in Makati City.
The same view was expressed by the country’s economic managers citing that the billions of dollars in development soft loans from development funding agency, could be used to bolster the country’s economy.
Consing likewise said that BPI’ economic researchers believe that the economic impact of Typhoon Yolanda was minimal. But the human toll was remorseful.
BPI economists said that the seven-percent growth in the third quarter proves that the economy is resilient and sustainable. Full year gross domestic product (GDP) growth for 2013 will be at 7.1 percent, and that the last quarter of the year will result in a 6.1-percent expansion.
It likewise prompted BPI to forecast that the Philippine economy will grow by 6.7 percent in 2014, and within the vicinity of 6.5 percent to seven percent in 2015.
For BPI, its loan books is forecast to grow “in the mid-teens†this year. Its net income will likewise outperform 2012.
At the end of Sept. 2013, BPI’s net income already stood at P15.8 billion. Full year 2012 net earnings stood at P16.3 billion.
Consing refused to make a forecast on the bank’s net earnings for 2013, although it was clear that the bank will once more outperform itself this year from the previous year.
However, inflation is expected to rise due mainly to base effects. “We forecast inflation to average at 2.9 percent in 2013 and 3.6 percent in 2014.â€
Remittances from overseas Filipinos is forecast to grow by an average six percent this year, while personal spending is projected to grow by at least six percent in 2014.
Moreover, reconstruction works on typhoon-stricken areas would provide a boost both in government and public infrastructure spending. However, bulk of the reconstruction will be done in the second half, which may translate to higher year-on-year growth.
Government likewise planned 12 percent and 35 percent increases in government spending and capital outlays, respectively, for 2014.