Like most Philippine banks, Banco De Oro has enjoyed a re-rating as the fortunes of the local market have improved. With the shares now at a price to book ratio of about 2.8 and on a prospective P/E ratio of 18, even CEO Nestor Tan thinks the bank, like the stock market, is fully valued for now.
"One risk [the Philippines] faces is that we overheat again because of speculative behaviour," says Tan, "and a contributor to the new wealth effect is the stock market. I wouldn’t want it to go much further from here."
He is in good company. UBS notes in a recent...
