HSBC to focus on growing mortgage segment in 2012

ONE of the world’s largest banking and financial organizations is focusing on developing the mortgage segment of its bank portfolio in Cebu.

Tony Cripps, Hong Kong Shanghai Banking Corp. (HSBC) president and chief executive officer for the Philippines, said in a recent interview that they noted Cebu’s robust growth in the real estate sector which had led to more clients availing of the bank’s mortgage packages this year.

“That’s one very attractive segment of our market that we would like to develop on further next year here in Cebu,” said Cripps.

Cripss said the bank’s housing loans portfolio grew 100 percent in 2010 and they were expecting a bigger growth rate by the end of the year.

“We have been growing this market since 2009 and now we are seeing the results. Most of the housing loans that we have in Cebu are for house and lot units. Nationwide though, it’s a balance between house and lot and condominium properties,” he said.

The bank, which has 7,500 offices in 87 countries, plans to continue to diversify their product offerings in the country next year especially in their retail and wealth management segment.

They also plan to increase deposits and focus more on the mortgage type of loans than on the bank’s credit cards.

“While we see that there is still a huge demand for the credit cards, we feel that we create more relationships with our clients through the mortgage type of products. You get more attached to your clients through the mortgage because you get to engage with them and offer more services to them than those using credit cards,” Cripps said.

Based on figures provided by the Central Bank of the Philippines, as of September 2011 real estate loans from universal and commercial banks in the country has reached P335.5 billion, P116.3 billion from thrift banks, and P13.3 billion from rural and cooperative banks.

Residential loans make up for 33 percent of the real estate loans from universal and commercial banks or P110.5 billion and 83 percent of the real estate loans from thrift banks or P96.9 billion.

With the growing number of developers now building more projects around the country including in Cebu, Cripps said that they are confident to hit more than a hundred percent growth for the housing mortgage loans next year.

Despite the bank’s optimism in Cebu’s real estate growth, Cripps said the bank was “cautiously optimistic” of the economic performance of Asia including the Philippines next year because of the effects of the European crisis./Reporter Aileen Garcia-Yap