BPI’s thrust: digitalization, customer obsession and sustainability

Published May 16, 2022, 12:05 AM

by Ignacio R. Bunye

SPEAKING OUT

Ignacio R. Bunye

The Bank of the Philippine Islands (BPI) recently held its annual stockholders meeting with the theme of reinvention as the Ayala-led bank outlined a strategy focused on customer obsession, digitalization and sustainability.

BPI President and CEO Jose Teodoro “TG” K. Limcaoco told BPI stockholders that the bank “will continue to reinvent banking so that we can better serve the evolving needs of our clients” and that “digitalization, customer obsession and sustainability remain to be our focus as we move forward to a post-pandemic environment.”

Digitalization

Limcaoco reported that while many companies purposely reduced expenses during the pandemic, BPI spent nearly P9 billion or about nine percent of total revenue in 2021 on technology, including new digital initiatives such as building and improving customer engagement platforms and onboarding new partners in its open banking business.

In October 2021, BPI announced plans to acquire and engage clients through seven customer engagement platforms, each specifically designed to fulfill the banking needs of a particular segment. Five platforms—BPI Online, BPI Mobile, BPI Trade, BizLink, and BanKo app—are already available today, with two more slated for release this year.

BPI’s ongoing digitalization journey continues to reinvent the customer interaction and experience. As of 2021, 4.9 million of its 8.46 million client base were enrolled in digital channels. Of the number, 3.24 million were active, up 20 percent from the previous year. BPI also has a growing list of over 80 API partners covering nearly 800 products and services, with over 100 million transactions in 2021, a 75 percent growth from the previous year.

Customer Obsession

Limcaoco reported that the BPI workforce also seeks to be “heroes for its customers” with a shift in mindset. In 2021, BPI created a new position for a chief customer and marketing officer, whose job is to put customer needs first. The bank also launched a concise version of its core values wherein everyone in the bank must be N.I.C.E, which touches on the need to be nurturing, acting with Integrity, being customer obsessed, and acting with excellence.

BPI likewise strengthened its coverage of various client segments, by forming a consolidated consumer banking unit that focuses on providing relevant financial solutions to the retail market. Corporate banking continues to cater to large corporations, Business banking covers the small, and medium enterprises (SMEs), while banko, it’s microfinance unit, looks after the self-employed micro entrepreneurs (SEMEs).
Limcaoco acknowledged the role of BPI’s 19,000-strong workforce in delivering excellent financial solutions and service to clients. “They have stood by our customers throughout these challenging times, and they are very much the driving force behind the bank we have become,” he said.

Limcaoco also gave due credit to his immediate predecessor, Cezar “Bong” P. Consing, who led BPI from 2013 to 2021. “Under him we made great leaps in our digital journey without compromising the business values that define BPI. BPI is in a great position today because of the forward-looking decisions he made.”

Sustainability

BPI also affirmed its longstanding commitment to sustainability. Last year, it officially rolled out its sustainability agenda. As of end-2021, about 48 percent of the bank’s portfolio was tied to initiatives that contribute to the United Nations Sustainable Development Goals.

BPI is also the first and only Philippine bank to give a time-bound commitment to halve coal generation financing in its portfolio by 2026 and bring it down to zero by 2032. It also supports the Task Force on Climate-related Financial Disclosures (TCFD). BPI had also announced that it would no longer finance green-field coal power projects going forward. In addition, BPI pioneered the first energy transition financing (ETF) loan that would enable an existing coal plant to close 15 years ahead of its economic life.
These initiatives have drawn recognition for BPI in terms of economic, social, and governance (ESG) standards. MSCI, S&P Global, and Sustainalytics gave BPI the highest marks among Philippine banks in ESG ratings in 2021.

Strong performance

In the same annual stockholders meeting, BPI Chair Jaime Augusto Zobel de Ayala (JAZA) noted the strong performance of the bank in 2021, when it delivered a net income of P23.88 billion, up 11.5 percent compared to 2020. The bank’s return on equity also improved to 8.40 percent from 7.70 percent the year before.

“Overall, while the pandemic brought unprecedented challenges, we believe that BPI has responded exceptionally well and has become a much stronger institution,” JAZA said in his message to shareholders.

He cited how, despite the hardships it created, the pandemic has led to several meaningful developments. “For example, digitalization has unlocked new ways to interact and access products and services, while greater sensitivity and empathy towards issues of sustainability and fairness have been developed.”
He also observed positive signs of recovery taking place in the banking industry. After a 2.8 percent contraction in 2020, loan demand rebounded last year, posting a 4.1 percent growth.

“BPI aims to be a meaningful partner as we start our recovery from the Covid-19 pandemic and re-establish and reinforce the pillars that will once again put the country on the path to equitable progress,” JAZA said.

 
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