Forces behind consolidationFitch Group’s think tank, BMI Research, said small pockets of weaknesses among smaller banks would provide consolidation opportunities for larger banks. It expects the current wave of consolidation to continue in light of competition from foreign banks and initiatives from the authorities. The Philippine banking sector is well positioned to weather external uncertainty as it boasts strong asset quality, sufficient capital buffers and a healthy liquidity profile, BMI said. “That said, we note that the banking sector is heavily fragmented and risks are unevenly distributed amongindustry players,” BMI said. Growth drives credit uptakeMoreover, a virtuous circle is at play where a strong economic growth outlook will drive credit uptake, further supporting economic growth, it said.

Source: Manila Times January 24, 2017 16:31 UTC