RCBC eyes up to 20% loan growth

MANILA, Philippines - Rizal Commercial Banking Corp. (RCBC) is targeting a loan growth of up to 20 percent and deposit growth of 12 percent this year.

“We would like to see consumer loan growth at more than 25 percent,” Lorenzo V. Tan, RCBC president and chief executive officer, said.

Last year, loans grew to P184.67 billion with the corporate accounts loan book rising by 30 percent, SME loans by 37 percent, and consumer loans by 15 percent. Net interest margin was high at 4.09 percent.

Tan said that this year, RCBC expects corporate loan growth at a more modest 17 percent, but loan growth of the small and medium enterprises (SME) at 25 percent.

Fee-based earnings meanwhile is seen to expand by at least 15 percent, buoyed by the anticipated strong sales of insurance from its joint venture bancassurance with Sun Life Financial as well as contributions from other cross-selling activities.

The Sun Life Grepalife Financial Inc. (SLGFI) was formed when Sun Life Financial acquired 49 percent of Grepalife Financial, the life insurance company of the Yuchengco Group.

SLGFI will introduce several variable unit linked (VUL) life insurance products, as well as new traditional insurance products, through the branch network of the Rizal Commercial Banking Corp. (RCBC) to raise new business premiums worth over P1 billion in 2012.

VUL products are life insurance products that are laced with an investment component, as well as a life insurance policy. Bancassurance is the practice of selling insurance products through a bank’s branch network, otherwise known as cross-selling.

Meanwhile, RCBC wants to increase its microloan disbursement by 48 percent through its microfinance-oriented subsidiary, Rizal Microbank.

“We expect to be able to double the number of borrowers by year-end. Rizal Microbank is also expanding presence to add at least two branches and four to six microfinance branch office (MBO) in 2012,” Tan added.

RCBC was likewise targeting deposit growth by at least 12 percent with an aggressive thrust for expanding its low-cost checking accounts savings account (CA/SA).

Total deposits ballooned to P255.46 billion last year or 20.33 percent from 2010. CA/SA to total deposit ratio improved to 56.53 percent in 2011 compared to 50.69 percent in the same period last year.

Meanwhile, the universal bank of the Yuchengco Group plans to open 12 to 15 branches this year as well as increase by another 200 its automated teller machines (ATMs) in the next few years.

RCBC’s branch network reached 389 in 2011 from the year ago number of 371. It likewise operated 761 ATMs last year compared to 609 in 2010.