China Bank posts record net earnings of P22 billion

CHINA BANKING Corp. (China Bank) saw its net income rise to a record high in 2023 amid higher revenues from its core businesses, it said on Tuesday.

The Sy-led bank’s net profit grew by 15% year on year to P22 billion last year, the lender said in a disclosure to the stock exchange.

This translated to a return on equity of 15.5% and a return on assets of 1.6%.

Its financial statement was unavailable as of press time.

“Our strong growth in 2023 solidifies our position as one of the top four banks in the country. We remain focused on executing our business strategies while leveraging our investments in digitalization to deliver better services to our customers,” China Bank President and Chief Executive Officer Romeo D. Uyan, Jr. said.

“Our continuous drive for operational efficiency and the strong client demand for our services underpin our solid financial performance in 2023. We will continue to strengthen our business fundamentals and capabilities to sustain our growth momentum in the coming years,” China Bank Chief Finance Officer Patrick D. Cheng said.

The bank’s net interest income increased by 17% year on year to P53.5 billion amid strong loan and investment growth and despite higher interest expenses, it said.

“Net interest margin was maintained at 4.2%,” China Bank said.

Meanwhile, the lender’s operating expenses went up by 11% to P27 billion amid bigger volume-related taxes and increased investments in manpower and information technology (IT).

“Simultaneously, substantial overhauls are underway within China Bank’s IT architecture as an integral component of its ongoing digital transformation endeavors,” it said.

China Bank’s cost-to-income ratio was at 50%.

Meanwhile, the bank’s gross loans grew by 10% year on year to P791 billion in 2023. Consumer loans made up 23% of the bank’s portfolio, it said.

China Bank set aside loan loss provisions of P1.2 billion.

Its nonperforming loan (NPL) ratio was at 2.5% last year, while its NPL coverage ratio was at 104%.

“On the funding side, total deposits rose by 11% to P1.2 trillion, with the current account-savings account ratio at 48%,” China Bank said.

The bank’s assets increased by 11% to P1.5 trillion last year.

Total equity likewise grew by 12% to P150 billion.

The bank’s common equity Tier 1 ratio was at 15.3%, while its capital adequacy ratio stood at 16.1%.

China Bank has 648 branches and 1,070 automated teller machines (ATMs) to date, including the 168 branches and 202 ATMs of China Bank Savings.

Its shares climbed by 25 centavos or 0.73% to end at P34.35 apiece on Tuesday. — A.M.C. Sy