Two of the country’s largest banks on Thursday reported double-digit growth in first-quarter net income on the back of higher loans and deposits.
BDO Unibank Inc., the country’s biggest bank in terms of assets, said net income rose13 percent in the first quarter to P11.7 billion from a year ago, driven by core businesses.
Bank of the Philippine Islands said profit climbed 59.6 percent in the first quarter to P8 billion from a year earlier on higher net interest income, lower loss provisions and normalized tax expenses.
BDO said loan portfolio rose 7 percent to P2.4 trillion on strong demand from corporate borrowers, the recovery in the middle market and the resilience of the consumer segment.
Deposits also went up to P2.8 trillion, driven by the 11-percent increase in current account/savings account deposits, which now comprise about 86 percent of total deposits. This resulted in net interest income of P33.9 billion in the first quarter, up 6 percent from a year earlier.
Non-interest income also went up by 9 percent to P16.7 billion, led by fees and insurance premiums. Trading and forex gains were in line with normalized business levels.
BDO said operating expense grew 3 percent to P31.8 billion, while asset quality continued to improve with non-performing loan ratio down to 2.72 percent from 2.81 percent last year.
The bank maintained its conservative credit and provisioning policy with provisions at P3.7 billion compared to P2.9 billion a year-ago, resulting in higher NPL coverage at 120.8 percent. Total capital base strengthened to P429.9 billion, with the capital adequacy ratio and common equity tier 1 ratio both increasing to 14.6 percent and 13.5 percent, respectively, which were above regulatory minimum.
BDO said the sustained earnings performance, robust business franchise and solid capital base placed the bank in a good position for long-term sustainable growth.
Meanwhile, BPI said revenues improved 4.3 percent in the first three months to P25.4 billion, as net interest income increased 12.7 percent to P19 billion, on the back of an 11 basis point expansion in net interest margin to 3.42 percent.
Non-interest income decreased by 14.5 percent to P6.4 billion, owing to lower securities trading gains, service charges, bank commissions and underwriting fees.
This was tempered by the notable year-on-year rebound in foreign exchange trading gains of P702.1 million.
BPI said total operating expenses rose 6.5 percent to P12.6 billion from a year ago, due to broad increases in all cost categories as the volume of transactions picked up, given the economic reopening and relaxed mobility restrictions.
The bank recognized provisions of P2.5 billion as of March 31, down by 30.6-percent from the P3.6 billion it booked over the same period last year.
Total loans went up 7.1 percent to P1.5 trillion, on higher loan volumes across the board, led by growth in the corporate, mortgage and credit card portfolios of 7.7 percent, 6.6 percent, and 12.2 percent, respectively.
Total deposits also grew 13.1 percent year-on-year to P1.9 trillion, with CASA and time deposits posting increases of 10.9 percent and 23.3 percent, respectively.
Total assets reached P2.4 trillion, up 9.88 percent from the previous year.
BPI launched in March BizKo, a subscription-based digital platform for micro, small, and medium enterprises, which offers an integrated online system for invoicing and collection to help with their cash flow and other banking needs.
BizKo is the fifth of the seven digital platforms in the bank’s digital transformation roadmap.
BPI also teamed up with AC Energy Corp., another Ayala company for the first energy transition financing in the country.