PSBank obtains top issuer rating

MANILA, Philippines — Philippine Savings Bank (PSBank), the thrift banking arm of the Metrobank Group, obtained an issuer rating of PRS Aaa (corp.) from local credit watchdog Philippine Rating Services Corp.

PSBank is the country’s second largest thrift bank with assets of P204.6 billion as of end March this year. The bank currently has 250 branches and 608 ATMs. 

An issuer rating is an opinion on the general and overall creditworthiness of the issuer, evaluating its ability to meet all its financial obligations within a time horizon of one year. 

The focus is on financial strength and stability under normal and stressed conditions to be able to meet existing and prospective financial obligations. 

A company rated PRS Aaa (corp.), the highest on PhilRatings’ credit scale,  has a very strong capacity to meet its financial commitments relative to that of other Philippine corporates.

In assigning the rating, PhilRatings considered PSBank’s solid market position underpinned by its well-defined growth strategy, the continued growth in the bank’s core interest income attributable to loan portfolio expansion, expectations that the bank’s funding profile will continue to improve supported by increased levels of current and savings deposits and the favorable outlook for domestic consumer credit. 

PSBank is considered a significant player in the domestic consumer market, with bulk of its loans portfolio represented by consumer loans. It believes its auto loan portfolio, which had the largest share of the bank’s consumer loans as of end-2016, still has ample room for growth, taking into account the bank’s current share of the auto loans market. 

While PSBank continues to target the retail deposit and consumer lending needs of the upper- and middle-markets, the bank’s recent product and service offerings to these markets, however, have become more technology-based. This strategy is expected to bolster the bank’s competitive position by satisfying clients’ increasing demand for more control and speed, while also integrating efficiencies in its operations. PSBank is likewise looking to serve the SME market to a greater degree, over the long-term.

In line with the expansion of the bank’s loan portfolio, interest income has been posting double-digit growth in the last three years and with an average share of 76.3 percent in operating income.