PHILIPPINE National Bank, the country’s fifth-largest lender controlled by tobacco and airline magnate Lucio Tan, is aiming for a double-digit growth in net income this year anchored on the strength of its core businesses.
“We see net income growing by mid-teens this year,” PNB executive vice president Horacio Cebrero III said in a briefing at the Century Park Hotel in Manila on Tuesday.
Cebrero declined to disclose profit guidance this year.
He said the first-quarter net income was more than twice the level posted in the same period a year ago. The robust first-quarter performance was driven by substantial improvements in both core and non-recurring revenues.
To sustain growth in the coming years, PNB will invest around P1.8 billion on financial technology to capture potential clients that include the millennials or those that belong to the new generation.
Senior vice president Norman Martin Reyes said the bank in July would launch a new mobile banking product catering to millennials.
“We will partner with retailers, aside from telcos, to widen our footprint and reach more people,” Reyes said.
Cebrero also said PNB would continue tapping the small and medium enterprises in the next three to five years and team up with anchor customers, such as suppliers and distributors of large conglomerates.
Cebrero said the bank planned to put up additional branches this year, 10 for the parent bank and 10 for the PNB Savings Bank. PNB has 630 branches while its savings bank has 40.
PNB posted a 15-percent growth in net income last year to a record P6.31 billion from P5.49 billion in 2014 on strong growth in loans and deposits.
PNB’ net interest income, comprising 67 percent of the total operating income, grew 7 percent to P17.7 billion from P16.5 billion due to the expansion of its loan portfolio.
Despite the squeeze in margins, interest income on loans and receivables rose 13 percent to P17.1 billion amid strong lending volumes from the corporate and commercial or small and medium enterprises sector.
Total resources increased 9 percent to P679.7 billion last year while the capital adequacy ratio—a measurement of financial strength—stood at 19.24 percent. The common equity tier 1 ratio stood at 16.23 percent, exceeding the minimum requirement of the Bangko Sentral ng Pilipinas.
Global debt watchers Moody’s Investors Service and Fitch Ratings upgraded PNB’s credit rating and outlook in May and October last year.