Philippine Saving Bank (PSBank), the consumer and retail bank arm of the Metrobank Group, has been given the highest Issuer Credit Rating of PRS Aaa (corp.), with a Stable Outlook, by the Philippine Rating Services Corporation (PhilRatings). 

A company rated PRS Aaa (corp.) has a very strong capacity to meet its financial commitments relative to that of other Philippine corporates. A Stable Outlook means a rating is likely to be maintained or to remain unchanged in the next 12 months. 

“The ratings reflect PSBank’s strong market position, its highly-experienced management team, and its sound capitalization and aggressive provisioning which are seen to temper the pandemic’s impact on the loan portfolio, at least in the short-term,” PhilRatings said. 

Based on data from the Bangko Sentral ng Pilipinas (BSP), PSBank was the country’s second largest thrift bank, in terms of assets (P239.3 billion), deposits (P183.7 billion), and loans and receivables, net (P161.8 billion), as of end-March 2020.

PSBank, however, ranked first among thrift banks based on capital of P33.6 billion.

The bank has a solid franchise in the consumer loans market and is a strong player in the auto loans segment, where the bank estimates to be accounting for 18 percent share of the thrift bank sector’s portfolio for 2019, and which was an improvement from its 16.9 percent market share in 2018. 

PSBank’s established solid market position is expected to be bolstered by the bank’s continuous digitalization of products, channels and processes designed to adapt to changes in consumer behavior, enhance customer experience and improve operational efficiency.

In particular, online platforms have become a necessity and are in demand with the ongoing health crisis which calls for restrictive movements and heightened safety protocols.

Moving forward, the bank’s responsive digital strategy is viewed as strongly supportive of the bank’s competitive position, given the growing number of digitally- inclined bank customers who are seen to demand personalization and convenience in bank products and services.

PSBank forecasts its non-performing loans (NPL) ratio to increase by end-2021, given the pandemic’s impact on the quality of the bank’s loan portfolio.

But its sound capitalization and aggressive provisioning are seen to temper pandemic-related risks on its loan book, at least in the short-term. PSBank has adopted a conservative provisioning stance for its loans.