Bankers strengthen corporate foothold to maintain growth

The banking sector is moving towards strengthening its foothold in the corporate market to keep the momentum of the industry’s growth buoyed by the surging demand of consumer-based products.

For the past few years, the banking sector has benefited from the active consumer-based market, which includes auto-loans, housing loans, credit card, and mortgages, among others.

At the moment, bankers are urging the corporate sector to consider various bank products as well as other corporate based products for capitalization requirements.

China Trust (Philippines) Commercial Bank Corporation, executive vice president and treasurer Rolando Avante, said banks are now trying to invite corporate clients to avail of different products offered by the banking institutions, such as big-ticket loans.

After the banking sector turned its back from the corporate market brought about by the 1997 regional economic crisis, companies have found different ways of sourcing funds, aside from banking institutions, while the banks had been very selective in providing corporate loans to businesses.

Instead of tapping the banks, Avante said more companies are utilizing internally-generated funds for their expansion ventures and other capitalization needs.

“The corporate sector has not been borrowing as much as before. We hope that while the economy is showing strength, the corporate sector will consider accessing the different products from the banks,” Avante said.

 Recently, he said the banking sector saw an improvement in the corporate market segment saying “corporate demand for loans is starting to go up.”

For his bank alone, he said demand for working capital from companies started to perk up, however, medium to big ticket loan demands are still slow.

Aside from using internally-generated funds of companies, Avante said some small and medium firms have also learned to raise funds for expansion through Initial Public Offering (IPO).

For the last few years, the consumer banking market have been the growth driver for most banking institutions, capitalizing on the Overseas Filipino Workers (OFWs), and the robust growth of Business Process Outsourcing (BPO) employment.

Aside from its bulk employee market, ChinaTrust is also serving thousands of Filipino Overseas Workers (OFWs) based in Taiwan, and the local Chinese traders.

Although it is owned by Taiwan-based ChinaTrust banking institution, the Philippine operation is locally incorporated, and operates as a subsidiary of ChinaTrust in Taipei, Taiwan.

The bank has 23 branches nationwide. Three of which are located in Cebu City and Mandaue City. — Ehda M. Dagooc