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April 8, 2008 |
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BANCO DEL PICHINCHA: Eyes 5% Growth in Net Profit This Year Banco del Pichincha's Chief Executive Fernando Pozo told Business News Americas that the bank is expecting a 5% increase in its net profit this year, compared to last year. Banco del Pichincha's net income decreased 1.4% in nominal terms to US$58.6 million in 2007, form US$59.5 million in 2006, BNamericas says, citing figures from financial sector regulator Superintendencia de Bancos y Seguros. Mr. Pozo told BNamericas that Banco del Pichincha's 2008 net income will reflect the combination of higher revenues mainly due to double-digit increase in loans "and significant provisions to provide the bank with a solid cushion against any potential loan losses." According to BNamericas, Mr. Pozo said he thinks it is prudent to give Banco del Pichincha "a fairly significant cushion in light of the country's less favorable environment for banks." BNamericas relates that bank loan growth dropped sharply to 8% in 2007, compared to 23% in 2006, due to political environment and weaker economic expansion. Ecuador's volatile political situation will continue to obstruct growth of the banking business in 2008, BNamericas states, citing market observers. Banco del Pichincha is a private bank in Ecuador. At the end of the first half (2006), Banco del Pichincha ranked first in the local financial system with an asset market share of 24%. The bank's parent is financial group Grupo Financiero Banco del Pichincha, Ecuador's largest financial group, with assets of US$3.71 billion at June end. Banco del Pichincha was founded in 1906 and has 227 branches in about 80 cities and 416 ATMs. * * * In August 2007, Fitch Ratings affirmed Banco del Pichincha's 'B-' long-term issuer default and B short-term issuer default ratings. Fitch said the outlook is negative. |
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