By James A. Loyola Security Bank Corporation expects its loan growth rate to be slower in 2018 compared to last year when loans unexpectedly surged 28 percent. PH-JAPAN TRADE OPPORTUNITIES AT THE 2ND BUSINESS MATCHING FAIR – Security Bank executives represented by Senior Vice President, Eduardo Olbes, Executive Vice President and Head of Corporate & Investment Banking Segment, Director and Executive Vice President of Alliance Segment Takahiro Onishi, and President and Chief Executive Officer Alfonso Salcedo Jr. with MUFG executives represented by Managing Executive Director and Head of Financial Solutions Group Makoto Kobayashi, and General Manager of MUFG Manila Branch Tatsuto Ishida hold a press conference for the 2nd Business Matching Fair. Security Bank Corporation (SBC) and MUFG Bank, Ltd., (MUFG), Japan’s largest lender, convened a total of 88 large, medium, and small-scale businesses in the FMCG (F&B, consumer goods, cosmetics, etc.) industry from the Philippines, Japan, Thailand, and Vietnam during the Business matching. A total of 229 business collaborations meetings were arranged for the participants. In an interview at the sideline of the Security Bank and MUFG Bank Ltd. 2nd Business Matching Fair, Security Bank President Alfonso Salcedo said that, aside from the high growth rate set last year, the bank has opted to be more conservative in granting loans this year. "For us it's also base effect. Last year was very strong. Right now what we've been doing is we're more selective because the market has been extremely competitive this year,” he said. Salcedo added that, “personally I don't think the loan pricing reflects the risk. I think a lot of the loan pricing of the industry has been driven by market share aspirations." He explained that, "for us, we are not really looking at it that way because we are an ROE bank, we look at return on equity, we know how much equity costs, and it doesn't make sense for us to lend below the cost of equity." Salcedo noted that the "very competitive" lending business, the loan rates for the top corporations, and even the middle market, had been quite "sticky." "They had gone up but the cost of funds has also gone up. And the cost of funds have been growing up faster than the loan rates that we could charge," he said. He note that, "margins on the top corporate will be the narrowest because these companies have pricing power. And that's why we're trying to grow our retail loan book as much as we can. Because that's the one that with the most margins." Salcedo said the slow loan growth is expected to persist in the whole lending industry, mostly because last year's growth was really strong. Security Bank and Japan’s largest lender MUFG Bank convened Japanese and Filipinos businesses at the 2nd Business Matching Fair, following a successful kickoff event in 2017. The strategic partners have arranged a total of 224 business collaboration meetings to provide clients a venue to expand their network and customer base. Security Bank and MUFG are expecting 87large, medium and small-scale businesses from the Philippines, Japan, Thailand and Vietnam (through MUFG’s partners) in the FMCG industry, particularly those from the food and beverage, consumer goods, consumer electronics, and cosmetics sectors. “From our kickoff event last year, more clients have expressed their interest in joining the second matching fair. Most of the Philippine and Japanese clients participating this year are new and are excited to hopefully seal business deals,” Salcedo said. Security Bank said that Japanese businesses are still bullish on the country’s high economic growth.