{"id":145790,"date":"2018-01-12T03:57:35","date_gmt":"2018-01-12T08:57:35","guid":{"rendered":"https:\/\/canadianinquirer.net\/v1\/?p=145790"},"modified":"2018-01-12T03:57:35","modified_gmt":"2018-01-12T08:57:35","slug":"interest-rate-hikes-may-impact-on-ph-banks-operations","status":"publish","type":"post","link":"https:\/\/canadianinquirer.net\/v1\/2018\/01\/12\/interest-rate-hikes-may-impact-on-ph-banks-operations\/","title":{"rendered":"Interest rate hikes may impact on PH banks’ operations"},"content":{"rendered":"
\"Economists<\/a>
BMI Research expects the Bangko Sentral ng Pilipinas (BSP) to start hiking its key rates this year (Pixabay photo)<\/figcaption><\/figure>\n

MANILA — BMI Research forecasts the sustained robust operations of Philippines banks but flagged the risk of rising interest rates, citing that this might impact on financial stability.<\/p>\n

In a study, the research arm of Fitch Group took on a \u201cneutral view\u201d on the country\u2019s banking sector, which is seen to continue benefiting from the improvement of domestic macroeconomic fundamentals.<\/p>\n

It explained that the robust domestic fundamentals \u201cshould be broadly supportive of loan growth, profitability and asset quality.\u201d<\/p>\n

BMI Research expects the Bangko Sentral ng Pilipinas (BSP) to start hiking its key rates this year and this, the research note said, would \u201cact as a damper on some of these performance metrics.\u201d<\/p>\n

It cited that with the current low interest rate environment and expectations for high growth given the strengthening of the economy leverage registered a sharp rise \u201cand malinvestment have started to accumulate in the economy.\u201d<\/p>\n

\u201cIf left unchecked, this pose(s) downside risks to financial stability, even though Philippine banks generally boast healthy capital buffers,\u201d it said.<\/p>\n

The study noted that banking assets and credit growth had decelerated after hitting record-highs in July 2017.<\/p>\n

This normalization was as expected, it said, because both gauges had been hitting strong growth.<\/p>\n

\u201cWe expect this trend to continue as interest rates are likely to rise over the coming quarters as the BSP tightens its monetary policy stance over the course of 2018,\u201d it said.<\/p>\n

BMI Research projected loan growth to post an average expansion of 14 percent in the next two years and this level, it said, \u201cis still a fairly strong figure\u201d and \u201cwill be supported by a healthy risk appetite.\u201d<\/p>\n

It also eyes an over 6 percent growth for the Philippine economy in the medium term and this growth is seen to be backed by the demographic sweet spot, strong state infrastructure spending, and greater economic cooperation with China and Japan, with the latter expected to \u201cbe supportive of trade and investment.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

MANILA — BMI Research forecasts the sustained robust operations of Philippines banks but flagged the risk of rising interest rates, …<\/p>\n","protected":false},"author":33,"featured_media":144136,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[19],"tags":[1216,32782,32783],"class_list":["post-145790","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-bangko-sentral-ng-pilipinas","tag-bmi-research","tag-fitch-group","mauthors-joann-villanueva","mauthors-philippine-news-agency"],"_links":{"self":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts\/145790","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/users\/33"}],"replies":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/comments?post=145790"}],"version-history":[{"count":0,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts\/145790\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/media\/144136"}],"wp:attachment":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/media?parent=145790"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/categories?post=145790"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/tags?post=145790"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}