CIMB PH says door open for future IPO after reaching profitability

Digital-only commercial lender CIMB Bank Philippines on Thursday said it was open to going public in the future, but this was not an immediate priority as its near-term target was to be "significantly stronger" after reaching profitability in 2023.

According to CIMB Philippines chief executive officer Vijay Manoharan, the bank is open to listing on the Philippine Stock Exchange (PSE) to onboard more investors, but conditions will have to be right for this to even come into consideration.

"In all our CIMB markets we go into, we always want to be opening ourselves up for local investors, local funding, and to play the local equity markets, so that's always been the CIMB approach and in the Philippines, it's not different," he told reporters in a briefing in Taguig City.

"But is it something immediately we are looking at? The answer is not really, but we will definitely in the right time take a look at those and say this is the right time we should consider. So it's not a closed door, but it's not immediate," he added.

Manoharan said that CIMB would take into consideration the valuation, and whether the firm would need extra and public funding. He said that the firm was still relatively young after starting operations five years ago.

"Once we get to the right trigger points, like maturity, also we're still young, then I think it's the right time to have those conversations. It is in our plans as a group, but not in our immediate plans," he said.

CIMB Philippines achieved profitability in 2023, which the bank attributed to the growth in its interest income amid the growth in its loans receivables and fees, and its balance sheet almost doubling since 2022.

Sought for his outlook this year, Manoharan said the firm expects profits to "significantly be very much more healthier than last year," adding that "significantly stronger would not be single digits."

As part of its expansion plans, CIMB is looking to penetrate new customer segments such as the overseas Filipinos and micro, small, and medium enterprises (MSMEs) through partnerships both in the public and the private sectors.

The bank reported 8 million customers as of end-May 2024, with total active customer accounts exceeding 11 million. This compares with the 7.5 million recorded as of end-2023, which it seeks to increase to 8.5 million this year.

It targets total deposits cash in total value to reach P500 billion in 2024, up from P250 billion to P300 billion at the end of 2023, while bringing total lending disbursements up to P75 billion, which would reflect a 23% growth from last year.

"Our work is far from done… We will continue our mission in disrupting the market with strategic partnerships, innovative solutions, and possible entry to underserved segments like the MSMEs and the overseas Filipino workers," Manoharan said.

CIMB Philippines earlier this year said it targets to grow its customer base to 10 million and double its balance sheet in the next three years.

The company in January launched its MaxSave Time Deposit, where clients can choose from three term tenures—six months with a 6.5% interest rate; 12 months at 7.0%; and 24 months at 7.5%—with a minimum deposit of P10,000. — VDV, GMA Integrated News