MANILA -- The Bank of the Philippine Island’s (BPI) Baa2 rating with Stable outlook was affirmed by Moody’s Investors Service on Thursday, citing that the bank’s deposit rating is underpinned by its baseline credit assessment (BCA).
These ratings cover the Ayala-led bank’s local and foreign currency deposit and foreign currency senior unsecured debt.
In a statement, the debt rater said it also affirmed the bank’s Baa2 BCA and adjusted BCA, (P)Baa2 foreign currency senior unsecured MTN program rating, P-2 local and foreign currency short-term deposit ratings, Baa1/P-2 local and foreign currency counterparty risk ratings, and Baa1(cr)/P-2(cr) counterparty risk assessments.
It explained that the bank’s BCA takes into account the bank’s “consistently robust capital and liquidity, which reflect disciplined and prudent business growth.”
Another factor that backs the BCA is the bank’s “track record of above-industry-average risk-adjusted profitability, supported by its dominant presence in the domestic corporate and consumer segments; as well as the high credit risk concentration in BPI's asset portfolio, which exposes the bank to vulnerabilities in single-name credit events or industry-specific cyclicality.”
It noted that the asset quality of the bank has improved in the last few years and new non-performing loan (NPL) formation remain low.
BPI has also addressed its legacy problem loans, it said.
At the end of the first half this year, the bank’s gross NPL ratio is 1.8 percent, almost near the 1.9 percent industry average
Its core profits are backed by robust loan expansion, stable net interest market and lower credit costs. (PNA)
