BPI’s net income up 33.3% in Q3

BANK of the Philippine Islands (BPI) saw its net income jump by 33.3% in the third quarter as it booked higher revenues, it said on Thursday.

BPI’s net profit climbed to P13.5 billion in the July-September period, which is “the highest quarterly net income achieved in the past decade,” it said in a statement.

The lender’s third-quarter performance brought its net income for the first nine months to P38.6 billion, up by 26.4% year on year, which it said was a “historical high for nine-month net income.”

This translated to a return on equity of 15.6% and a return on assets of 1.95%.

The bank’s financial statement was unavailable as of press time.

“Sustained loan and margin growth, as well as tempered provisions, were the main drivers of the strong financial performance,” BPI said.

Revenues rose by 18.3% year on year to P35.3 billion in the third quarter as the bank posted higher net interest and non-interest income.

For the first nine months, revenues climbed by 15.3% to P100.9 billion, “attributable to the 24.5% increase in net interest income to P76.8 billion, as average asset base expanded 8.1% and net interest margin widened 54 basis points to 4.07%.”

“This was partly offset by the 6.6% decline in non-interest income to P24.1 billion due to the property sale gain recognized in the prior year. Removing the impact of this one-off transaction, non-interest income would be higher by P3.3 billion or 15.7%, on higher fees from credit cards, bancassurance, various service charges, and trading gains,” BPI said.

Meanwhile, operating expenses increased by 21.3% to P48.6 billion in the first nine months as the bank ramped up spending for manpower, technology, and marketing.

BPI’s cost-to-income ratio was at 48.2%.

The bank’s loan portfolio grew by 8.8% to P1.7 trillion amid increases in corporate (5.3%), credit card (37.7%), and auto (22.3%) loans.

The bank’s nonperforming loan (NPL) ratio stood at 1.97%.

“Meanwhile, coverage remains adequate, with a 158.95% NPL coverage ratio,” BPI said.

Provisions for loan losses went down to 60% to P3 billion in the first nine months from P7.5 billion in the same period last year.

On the funding side, total deposits went up by 6.7% to P2.2 trillion at end-September.

The bank’s loan-to-deposit ratio stood at 80.2%.

Meanwhile, BPI’s assets stood at P2.7 trillion as of end-September, rising by 7.2% year on year.

Total equity was at P349.6 billion.

The bank’s common equity Tier 1 ratio stood at 16.1%, while its capital adequacy ratio was at 17%, well above the regulatory minimum.

BPI shares went down by 70 centavos or 0.65% to close at P106.80 each on Thursday. — A.M.C. Sy