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Tuesday, January 20, 2004
Subcontractors without collateral get loans at Wealthbank: official
By Jessica B. Natad
THE banking arm of the Metro Gaisano group of companies is encouraging subcontractors of exporters to avail themselves of the bank’s lending facility.
Wealthbank president Sabiniano Villamor said the bank had been lending to subcontractors of exporters at 1.5 percent monthly interest, without collateral, since July last year.
“This sector (subcontractors) is one of the sectors not gaining support from financing institutions.
This is why most of them usually run to people giving 5-6 loans, which are really very expensive.
We (Wealthbank) decided to include them in our priority sectors,” he said.
In 5-6 loans, which are usually short-term loans, a borrower borrows P5 and pays back P6, with the P1 representing an interest rate of 20 percent.
To accommodate subcontractors, especially the small ones, Villamor said Wealthbank is going to base the loan approval on the business performance of the partner-exporter of the loan applicants.
He said faster loan approval is Wealthbank’s edge over other banks, especially those that are only branches of big banks.
“Because we are local, decision making is very fast. Our executives are here, and they decide on issues including loan applications fast, unlike other banks that have to wait for their Manila executives to act on loans,” Villamor said.
He said the loan facility to subcontractors is among the services that contributed to Wealthbank’s “good” performance last year.
Wealthbank’s depositor base in its six branches grew by more than 100 percent from 2,000 to 5,000. Wealthbank has two branches in Cebu City, and one each in Danao, Mandaue, Cagayan de Oro and Tagbilaran cities.
The bank’s deposits last year also more than doubled from the year-ago level. Wealthbank is a private development bank. It celebrated its 37th anniversary last Oct. 10.
Meanwhile, Villamor said there is no economic difficulty as far as the Cebu local economy is concerned.
“Just look at Sun.Star’s classified ads, many companies are looking for employees. Why are they hiring if indeed the economy is bad?” he said.
(January 20, 2004 issue)
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