The Philippine central bank is set to unwind the relief measure allowing banks to use loans to small businesses and large enterprises as alternative compliance with the reserve requirements. — REUTERS

BANK of the Philippine Islands (BPI) expects steady demand for credit for the rest of the year, even after the slowdown seen in the first half.

“Loan demand has slowed down a bit in the first half, but we expect it to maintain the same pace in the second half,” BPI President and Chief Executive Officer Jose Teodoro K. Limcaoco told reporters on the sidelines of BPI Foundation’s Financial Wellness Fair last week.

BPI saw its loans expand by 10.5% to P1.7 trillion in the first half, driven by the corporate, credit card, and auto portfolios, it reported last week.

Mr. Limcaoco said the bank’s growth in the second half will continue to be driven by “a strong economy [and] accommodative macro fundamentals.”

Meanwhile, Mr. Limcaoco said the Ayala-led bank is not looking to apply for a digital banking license, even as the Bangko Sentral ng Pilipinas (BSP) said it is considering reopening applications next year following a moratorium imposed after it gave permits to six new lenders.

“Particularly for BPI, we’re pushing very hard on the digital front, which means we don’t really need a specific license for digital banking. What the specialized license does is it sends new players into the banking system with less of a physical presence. But I don’t think that’s necessary for existing banks because we already have a presence,” he said.

Big commercial banks, in general, do not need to venture into the digital banking market as they already operate with the advantage of having a physical presence, Mr. Limcaoco said.

“We can do exactly the same thing a digital bank does with our license, so I can see why a new player wants it. But for an existing bank, we don’t need that license to be digital,” he added.

BPI saw its net income rise by 4.5% year on year in the second quarter to P13 billion amid an increase in revenues.

This brought its first-half net income to P25.1 billion, up by 23% year on year.

The Ayala-led bank’s shares rose by 50 centavos or 0.44% to end at P115 apiece on Friday. — A.M.C. Sy

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