Sun Savings, Camella tie up
CEBU-BASED Sun Savings Bank has expanded its loan portfolio to include housing loans.
Last Friday, Sun Savings signed an agreement with Camella Homes to formalize the thrift bank’s entry in home loan offerings.
Unlike other banks that offer home loan financing across all levels, Sun Savings Chairman and Chief Executive Officer Francisco Dizon said the bank will concentrate on loaning amounts to the affordable housing market or to consumers who can afford houses or condo units at price levels ranging from P800,000 to P3 million.
The bulk of the housing demand comes from the so-called broad C segment or consumers with monthly household income of P20,000 to P60,000. This market includes start-up families, young professionals, overseas Filipino workers, and entrepreneurs.
“At present, this is the market that has the biggest supply and this is the market that we think needs more financing,” said Dizon in an interview.
According to Dizon, Sun Savings’ home financing options are quite competitive with that of Pag-ibig at 6.5 percent interest rate per annum, fixed for up to three years.
“The bank’s goal here is to give customers the best possible deal and provide them with the most convenient and easiest way of owning houses,” he said.
After Camella, Sun Savings will tie up with two more developers before the end of this year.
“Our target for 2016 is to generate at least P100 million in housing loans for the first year. But we are hoping to overshoot the target as more tie-ups or partnerships with developers will happen next year,” he said.
Consumer loans, specifically from Department of Education teachers and employees’ loans, account for the bulk of Sun Savings’ total loan portfolio, followed by loans to acquire pre-owned cars. The bank also provides financing to small and medium enterprises.
Dizon said the bank will be building up its other loan products, specifically housing loans, given the growing middle class and sustained interest rates that continue to fuel demand in the market. (Disclosure: Dizon serves on the Board of Directors of Sun.Star Publishing Inc.)
The Bangko Sentral ng Pilipinas (BSP) recently reported that banks’ exposure to real estate increased by 17.3 percent to P797.67 billion ($17.19 billion) in end-July 2015 from P685.38 billion ($14.76 billion) in the same period last year.
The BSP has maintained its position that there is no asset bubble in the Philippines and that the increase in property prices and growth of the sector have essentially been demand-driven.
As of November, Sun Savings’ total assets stood at P625 million. The bank, which has four offices in Metro Cebu, targets to end 2015 with P650 million in assets.
With the expanding middle class, Sun Savings will also be embarking on technological shifts to engage more consumers in digital banking. In the next three to five years, it intends to introduce applications and platforms that will allow bank clients to transact more online.
“The banking landscape has changed. Your gauge of growth is no longer anchored on how many branch networks you have but on how many people or consumers you engage in mobile banking,” said Dizon.