"We do not look at the short-term but the long-term, and that is what builds our confidence in the Philippines as our long-term projections are still extremely positive," said SCBP chief executive officer Annemarie Durbin during the formal presentation of their universal banking license last Tuesday.
Durbin noted that the peso has had a long history of value fluctuations especially in the past decade. However, she pointed out that the long-term economic fundamentals are basically sound despite fluctuations in key economic factors like inflation and budgetary deficits.
"We will ride out any short term problems. It is important to note that most of the short-term factors are caused by external factors, which are outside anyone’s control so that you cannot penalize the country for those factors," the SCBP head said.
Most foreign bank executives view the Arroyo administration and her team of economic managers with optimism even as they urge government to take an extremely serious stand on the worsening budget deficit and the poor tax revenue collections. "These are the two fundamentals that would move back the economy further," Durbin said.
Adding to the woes of the economy is the global economic slowdown, particularly the Japanese and US economies, two of the largest trading partners of the Philippines.
"If the US pulls out of its "depressed" condition quickly, the Philippine economy will likewise bounce back just as quickly irrespective of any fundamentals in the domestic front," the SCBP chief executive said.
Meanwhile, the bank’s profits are seen to grow four times while its non-performing loans (NPLs) are seen to remain at a single-digit level.
"Profits will grow at least four times over that of last year. In terms of profits, the bank as a whole is performing extremely well this year. That is due to a combination of revenue growth, focusing on areas that produce profitability, and also cost control where we have reengineered for faster delivery of service," Durbin said.
Revenues are seen to come from different areas especially from the credit card business, and from individual and corporate customer transactions. They are looking at increased activities in debt syndication, consumer banking, and fixed income.
SCBP’s capital base has grown to P4.95 billion from P3.6 billion.
"The universal bank license will deepen our relationship with our corporate customers. What we are finding in the local market is that they want to work on a bilateral basis when they are working with a bank. They want to issue their own paper in their own name. And that is what the license allows us to do for the customers," Durbin said.
Revenues grew by 11 percent in 2000 compared to the previous year. Loan portfolio grew 16 percent last year compared to the three percent registered by the industry while its non-performing loan (NPL) ratio improved further from 10.68 percent in 1999 to a single-digit ratio of 7.63 percent last year.
Last year, its deposits were up 77 percent to more than P25 billion, P14 billion in 1999.