By James A. Loyola
BDO Unibank, Inc. (BDO) reported yesterday a 49.3 percent jump in net income to ₱32.1 billion for the first nine months of the year from the 21.5 billion earned in the same period last year.
In a disclosure to the Philippine Stock Exchange, the bank said earnings growth was largely driven by the expansion in its recurring core revenues.
Customer loans increased by 6 percent year-on-year (yoy) to ₱2.1 trillion, led by the sustained growth in the middle-market and consumer segments.
Meanwhile, total deposits went up by 3 percent yoy to ₱2.4 trillion, with low-cost Current Account/Savings Account (CASA) deposits increasing by 6 percent and accounting for 72 percent of total deposits.
Net interest income (NII) increased yoy to ₱88.5 billion, with net interest margins (NIMs) further improving in the third quarter of 2019.
Non-interest income went up yoy to ₱44.1 billion, led by fee-based income and insurance premiums which accelerated by 14 percent and 23 percent to ₱25.4 billion and ₱10.8 billion, respectively.
Trading and foreign exchange gains in the third quarter of 2019 amounted to ₱690 million from ₱1.0 billion year-ago.
However, the trading and forex gains of ₱4.3 billion for the nine-month period reflects a normalized level compared to 2018, where a more volatile environment prevailed. As such, gross operating income rose to ₱132.6 billion.
Provisions amounted to ₱4.2 billion as the Bank maintained its conservative credit and provisioning policies. Gross non-performing loan (NPL) ratio was steady at 1.2 percent, while NPL cover remained high at 168.2 percent.
The Bank’s capital base increased to ₱364.0 billion, with Common Equity Tier 1 (CET1) and Capital Adequacy Ratio (CAR) improving to 13.1 percent and 14.6 percent, and remaining comfortably above the current regulatory minimum under the Basel III framework.
With its focused growth strategy, strong business franchise, solid balance sheet and extensive geographic reach, the Bank said it remains solidly positioned to capitalize on the country’s solid economic pace and growth opportunities in underserved and emerging markets.