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Friday, March 29, 2024

China Bank’s income climbed by 39% to P10.1B in six months

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China Banking Corp. said Thursday net profit jumped 39 percent in the first half to P10.1 billion from a year ago, driven by higher net interest income and core fees.

China Bank said in a statement the robust income performance translated into a better return on equity and return on assets of 16.4 percent and 1.7 percent, respectively.

“The sustained growth puts China Bank in a stronger position to support customers and the economy in this period of recovery,” China Bank president William Whang said.

Net interest income climbed 16 percent to P22 billion on the back of stronger top line revenues and steady movement in interest expense. Net interest margin was maintained at 4.3 percent.

The decline in trading and foreign exchange gains weakened fee-based income to P3.2 billion. Core fee income went up 24 percent, on double-digit growth in service charges, fees, commissions, income from sale of acquired assets and bancassurance.

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The bank said it reduced credit provisions by 69 percent to P1.7 billion, reflecting the positive economic outlook and improving asset quality.

Gross non-performing loans ratio was at 2.3 percent or 120 basis points lower than a year ago and better than the industry average. NPL cover remained sufficient and above industry at 128 percent.

Efficiency enhancements and judicious cost management kept operating expenses stable, improving the cost-to-income ratio to 44 percent.

China Bank chief finance officer Patrick Cheng said the bank consistently recorded quarterly income growth throughout the pandemic. “For the second quarter 2022 period, China Bank’s net income breached the P5-billion mark, a first in the bank’s more than 100-year-old franchise,” Cheng said.

China Bank remains one of the largest lenders in the country, with consolidated assets rising 17 percent year-on-year to P1.2 trillion as of end-June.

Loans expanded 14 percent to P655 billion on the back of significant growth in both business and consumer loans. Total deposits increased 14 percent to P945 billion, as the bank sustained a 14-percent year-on-year build-up in current and savings accounts.

Total equity jumped 16 percent to P127 billion, with common equity tier 1 ratio and total capital adequacy ratio of 14.8 percent and 15.7 percent, respectively, above the minimum regulatory requirement.

Moody’s Investors Service recently affirmed China Bank’s investment-grade credit rating with stable outlook.

ChinaBank has 637 branches and 1,036 ATMs nationwide, including the 160 branches and 167 ATMs of China Bank Savings.

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