Philippine banks uncertain

Philippine banks uncertain

TOKYO (AFP): Standard and Poor's Asia Ltd. said yesterday that
the outlook for Philippine banks was uncertain given with the
proposed entry of foreign banks and the possible weakening of
credit standards as lending grows.

"Despite recent good performances and relatively solid
financial profiles, the credit quality of Philippine banks is
weakened by the relatively high country and economic risks
associated with a developing country such as the Philippines,"
the agency said in its latest ASEAN Banking Profiles report.

Economic risks restrain the international credit risk standing
of banks in the Philippines which was assigned a BB-minus
sovereign rating for senior foreign currency obligations in June
last year.

The medium-term credit outlook for commercial banks has
"favorable features, such as generally solid capitalization and
relatively high earnings, a satisfactory credit loss record and
supportive ownership structures.

"Supporting the favorable outlook factors are a strengthening
economy, greater political stability and improved business and
investor confidence.