BDO registered 23% growth in nine-month profit to P40b

BDO Unibank Inc., the country’s largest lender controlled by the Sy family, said Friday net income jumped 23 percent in the first nine months to P40 billion from P32.4 billion a year ago on solid results across core businesses.

BDO said in a statement this translated into a return on average common equity of 12.4 percent, higher than 10.7 percent it booked a year-ago.

Gross customer loans went up by 10 percent year-on-year, largely funded by low-cost current account and savings account deposits. This pushed net interest income to P108.1 billion.

Non-interest income amounted to P53.2 billion in the first three quarters, led by a 20-percent expansion in fees and insurance premiums, while trading and forex gains were broadly in line with expectation and primarily generated by flow-related business. Gross operating income reached P161.3 billion.

“Despite the bank’s strong performance year to date, management is conscious of external headwinds brought about by slowing global growth, persistent inflation and lingering uncertainties related to the Covid-19 pandemic,” the bank said.

“BDO nonetheless believes that its established business franchise and strong balance sheet allows the bank to overcome near-term risks and achieve long-term sustainable growth,” it said.

Operating expenses rose to P98.1 billion, as the bank continued branch expansion activities in underserved markets in rural areas and sustained information technology spend to support digital initiatives.

Asset quality improved as the non-performing loan ratio went down to 2.23 percent. The bank maintained its conservative provisioning policy by setting aside provisions of P12.2 billion, resulting in a higher NPL coverage of 152 percent.

Total capital increased to P444.6 billion, with capital adequacy ratio and common equity tier 1 ratio both above regulatory minimum at 14.4 percent and 13.3 percent, respectively.

BDO opened 64 branches this year, mostly in rural areas covered by subsidiary BDO Network Bank Inc. This brought the total branches to 1,608 as of Sept. 30, 2022.

BDO is a full-service universal bank which provides a wide range of corporate and retail services such as traditional loan and deposit products, treasury, trust banking, investment banking, private banking, rural banking, cash management, leasing and finance, remittance, insurance, cash cards, credit cards and online and non-online brokerage services.

The bank has more than 4,500 ATMs nationwide. It also has 16 international offices, including full-service branches in Hong Kong and Singapore.

BDO ranked as the largest bank in terms of total assets, loans, deposits and trust funds under management based on published statements of condition as of June 30, 2022.