Philippine, Indonesian Stocks Climb to Records on Bank Earnings

Philippine and Indonesian stocks advanced to all-time highs, led by financial shares, after Bank of the Philippine Islands reported record profits and PT Bank Rakyat Indonesia earnings beat analyst estimates.

The Philippine Stock Exchange Index climbed 1.2 percent to 6,318.61 at the 3:30 p.m. close in Manila. The Jakarta Composite Index rose 0.6 percent to 4,481.63. Bank of Philippine Islands jumped 2.8 percent and Bank Rakyat advanced 0.6 percent.

Philippine stocks have rallied 8.7 percent this year, while Indonesian equities have risen 3.8 percent, beating the MSCI Asia Pacific Index’s 2.8 percent advance, as the outlook for earnings is boosted by two of Asia’s fastest growing economies.

“Indonesia and the Philippines are considered among the most attractive markets in Southeast Asia because of their improving economy and strong consumer base,” said Jonathan Ravelas, chief market strategist at BDO Unibank Inc. in Manila. “Banks give investors a good and broad exposure to those markets and their dynamics.”

The $224.8 billion Philippine economy grew 6.8 percent in the fourth quarter, while Indonesia’s central bank estimated last month that the $846.83 billion economy expanded 6.2 percent in the same period, China grew 7.9 percent in the same period.

Growth Forecasts

Philippine gross domestic product may expand as much as 8 percent this year, Socio-economic Planning Secretary Arsenio Balisacan said yesterday. Bank Indonesia Deputy Governor Halim Alamsyah forecast on Jan. 10 growth of as much as 6.8 percent. Indonesia will release GDP data on Feb. 5.

Lenders in the Philippines, Indonesia and India are the “most attractive,” with the “highest next-12-month banking sector performance” outlook among Asian emerging markets this year, according to a BernsteinResearch report dated Jan. 31. The report also surveyed markets in China, Malaysia and Thailand.

Bank of the Philippine Islands, the nation’s biggest lender by market value, advanced to 102.80 pesos. Profit rose 27 percent to a record 16.3 billion pesos ($400 million) last year, the bank said yesterday after the close of trading.

BDO Unibank, the largest Philippine bank by assets, gained 2.2 percent to a record.

Bank Rakyat, Indonesia’s second-largest lender by assets, rose to 8,000 rupiah, the highest close since Jan. 18. Full-year net income jumped 23 percent to 18.5 trillion rupiah ($1.9 billion), exceeding the 17.08 trillion-rupiah median estimate of 29 analysts in a Bloomberg survey.

Bank Negara Indonesia jumped 8.3 percent to the highest since Aug. 18 2011 and Bank Central Asia increased 2.1 percent to an all-time high.

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