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MANILA, Philippines - Metropolitan Bank and Trust Co. expects lending this year to grow at a slower pace of 10 to 12 percent even as the economy would expand at a faster pace.
Jette Gamboa, Metrobank vice president and head of strategic planning and investor relations, said on Wednesday that loan growth was “better than anticipated” in the first two months this year. Credit rose 16.5 percent last year.
Gamboa said the Philippines’ gross domestic product (GDP) would grow an average 4.6 percent, higher than last year’s 3.7 percent. This would be on the strength of higher investments inflows and a pickup in government spending.
Inflation would average 4.8 percent, or within the three to five percent target range of the Bangko Sentral ng Pilipinas (BSP), Gamboa said.
Metrobank officials said domestic interest rates are likely to move sideways on the back of tame inflation and excess liquidity. Marc Bautista, Metrobank head of research, said short-term interest rates would inch up in the coming months, as lending rates fall behind the policy rates of the BSP, whereas long-dated interest rates would fall as loan demand slows.
The lender said downside risks to the Philippine economy would come from global uncertainties.
“The economies of member countries of the euro area are seen to be weighed down by weak domestic and global demand, tight fiscal policies and overleveraged countries in the southern periphery. The sluggish growth in these countries is expected to hit emerging economies through the trade channel,” Metrobank told shareholders during their annual meeting on Wednesday.
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