Bank of Philippine Islands (BPI.PS): Asia Financials Corporate Day Takeaways

Research evidence excerpt

Bank of Philippine Islands (BPI.PS): Asia Financials Corporate Day Takeaways

Equity Research

22 June 2026 | 6:26PM SGT

Bank of Philippine Islands (BPI.PS): Asia Financials Corporate Day

Takeaways

Melissa Kuang, CFA

+65-6889-2869 |

melissa.kuang@gs.com

Goldman Sachs (Singapore) Pte

Wayne Wang

+65-6889-2866 |

wayne.q.wang@gs.com

Bottom line:

We hosted BPI’s CFO Eric Luchangco at our Asia Financial Corporate Day today.

Overall, management remains cautious in the near term given macro headwinds and

the lagged impact from inflation and rate hikes, but views this as a transitory phase

with a clearer path to recovery over the medium term, with ROEs expected to

recover towards the 15% target as growth normalises and returns improve. For this

year, BPI highlighted that (1) NIM could benefit from rate hikes with partial

pass‑through across the loan book; (2) loan growth is expected to moderate as the

bank adopts a more prudent stance, particularly in SME and retail segments; (3)

credit costs are likely to be higher given macro risks but remain within the 90–

100bps guidance range; (4) operating expenses will be elevated this year before

normalising, with scope for positive jaws from next year; and (5) capital return is

expected to be higher this year, reflecting a more subdued growth outlook.

Key takeaways:

n Net interest margins are expected to see some support from higher policy

rates, with management highlighting that a 25bps increase in rates could

translate into a 4 to 5bps uplift in margins, largely driven by corporate loan

repricing. The pass-through on the retail book remains more limited, given

regulatory caps and competitive dynamics in products such as credit cards,

mortgages and auto loans. Overall margin sensitivity remains positive, although