PSBank plans capital raising

Philippine Savings Bank (PSBank), the thrift banking arm of the Metrobank Group, plans to raise capital next year to fund its expansion. PSBank President Pascual M. Garcia III yesterday said the bank wants to set up 10 branches next year in order to expand its customer base. He did not provide details, however, on how much PSBank plans to raise, through what method or when this would take place. "We plan to open 10 new branches next year, particularly in the rural areas," he told reporters. Among the places he identified where the new branches will be put up are Alaminos in Pangasinan and Mandaue City in Cebu. PSBank at present has a network of 170 branches and 285 automated teller machines nationwide. Mr. Garcia said the bank would also undertake acquisitions next year. "It could be another thrift bank. What we have to do is to continuously raise capital," he said. In 2008, the bank raised P2 billion in fresh capital from a stock rights offer to strengthen its total capital adequacy ratio (CAR), which reached 18.85% by the end of the year from 15.7% in 2007. PS Bank’s CAR had declined to 15.7% in 2007 from 19.4% in 2006. Its CAR stood at 14.73% as of September. For next year, Mr. Garcia said PSBank is upbeat its loan growth would be stronger due to a newly-introduced loan rebate program and an improved economic environment. The loan rebate program, which gives rebates to borrowers who pay in advance or in excess of their monthly amortization, he said, will encourage individuals to go to PSBank for their loans. "We are the only bank that gives rebate for early payment," he said. The program, which covers existing and new loans such as auto loans, home loans, SME (small and medium enterprise) loans and personal loans, was launched last month in response to requests of clients. Mr. Garcia said the expected economic recovery next year would also support the growth of the bank’s loans. As of end of September, PSBank’s loan portfolio stood at P47.33 billion, 18% higher year-on-year. Its net income rose by 23% year-on-year to P893 million. As a thrift bank, it ranks second to the BPI Family Savings Bank, with assets summing up to P86.9 bllion as of September. -- Louella D. Desiderio, BusinessWorld