EastWest Bank expects 10-15% loan growth

EAST WEST Banking Corp. (EastWest Bank) expects its loan portfolio to grow between 10% and 15% this year, backed by the strength of its consumer business and despite weakening business sentiment amid domestic corruption concerns.

“A good performing bank on the consumer market needs to grow at a regular pace over time. That’s what we’re trying to achieve. Maybe 10% to 15% is what we’re targeting; in between is probably most likely. So, consumer demand in the country is still okay. My biggest fear is that, again, from a macro perspective, it’s government spending, investments, consumer, net flows, import, export,” EastWest Bank Chief Executive Officer Jerry G. Ngo told reporters on Tuesday.

“And I hope that consumption continues to be robust, because that’s really what’s going to end up driving economic growth.”

As of end-June, EastWest Bank’s loans and receivables stood at P351.41 billion, up by 4.46% from P336.41 billion at end-2024.

Its consumer loans grew by 15% year on year in the first half to P298 billion, making up 84% of its total loan portfolio, Mr. Ngo earlier said.

He said last week that they hope to post steady loan growth in the coming years.

“We continue to be hopeful. Long term, we’ve been looking at low- to mid-teens growth. Actually, right now, we’re probably looking at 10% to 15% ranges of overall growth. And what we want to do is, across the cycle, we want to keep that type of growth.”

Mr. Ngo added that the bank has a low exposure to the expected economic drag from the corruption mess involving state flood control and infrastructure projects amid its consumer-centric lending business.

However, he noted that foreign investors have been harder to attract due to the scandal.

“[Exposure] is very limited because we rely on consumption… [But] the reality is, we will be affected [because] it affects the entire economy. And it’s quite sad, particularly if I speak to foreign investors. Before you even start the conversation, that’s the first thing they ask. So, it’s a bit challenging.”

Meanwhile, Mr. Ngo said they also want to expand their lending to the small and medium enterprise (SME) segment.

“The country’s demographic age is 26 years old, median. At 26 years old, we will consume. And what I always look out for is the employment rate. One of the key things that we’re trying to do is to spur people to do your own business… And I think that’s what we should be doing to really make sure that the country expands that base,” he said.

The bank last week launched its BizAccess Visa Debit card, which caters to SMEs.

Mr. Ngo added that lending growth will be supported by lower interest rates amid the central bank’s easing cycle.

“I think additional rate cuts would boost consumption. We just need to watch the foreign exchange (FX). But the US is cutting rates also, and I know that it is not because of the rate cut that the FX is low. The currency should start appreciating because the inflows should be coming in,” he said.

The peso last week recorded a new all-time low of P59.13 against the dollar, surpassing the previous record of P59 logged on Dec. 19, 2024.

EastWest Bank booked attributable net earnings of P2.3 billion in the second quarter, bringing its first-semester profit to P4.13 billion, rising from P3.49 billion in the comparable year-ago period. — A.M.C. Sy