BDO Unibank keen on financing PPP projects

Banco de Oro Unibank Inc. (BDO) on Friday said it is keen on funding public-private partnership (PPP) projects as the government hits the ground running to implement the program in the next few months. The rollout of the initial PPP projects will also boost its 2011 growth as contractors seek funding for projects, Sy-owned BDO said. BDO president Nestor Tan said the bank's primary role will be as financier and not as investor in the PPP initiative. "We will finance proponents. It's not easy to say that we will invest on projects without looking at proponents. The underlying risk is with them," Tan said, adding BDO has been an active lender to government projects since 2002. Tan said BDO expects the project rollouts to boost economic optimism in the next few months as investors look forward to partnering with government. Just recently, the Bangko Sentral ng Pilipinas reported that business confidence dropped for the second straight quarter to 31.8 percent on the back of delayed government disbursement of funds for PPP projects — among other reasons. Apart from funding PPP projects, Tan said the company expects sustained remittances from overseas Filipino workers and the stable foreign exchange rate as main growth drivers for the year. Tan pegged the earnings guidance for the year to hit P10.5 billion, 19 percent higher than its 2010 net income. He said the first quarter earnings of P2.4 billion, or 18 percent higher than the same period in 2010, was on track with the 2011 guidance. Gross customer loans for the period grew 16 percent year-on-year, he added, while total deposits were up to P746.2 billion. "We have taken steps to have full coverage of our non-performing loans to protect our capital. In the case of any downturn, we have more than enough provisions to cover without impairing our capital," Tan added. Tan said they are seeing consumer lending as their primary growth sector, in keeping with its strategy to grow certain segments faster than the others. BDO currently operates 725 branches across the country, with 20 offices abroad and as much as 1,400 ATM terminals spread nationwide. — VS,GMA News