EWB reports record ₱6.2-B net income

Published March 7, 2020, 12:00 AM

by manilabulletin_admin

By James A. Loyola

Gotianun-led EastWest Bank (EWB) reported a 38 percent hike in net income to a record ₱6.2 billion in 2019, mainly driven by the growth of its consumer loans portfolio and low cost deposits.

In a disclosure to the Philippine Stock Exchange, the bank said it maintained its top-tier position in profitability with Return on Equity (ROE) at 14 percent.

Net revenues rose 13 percent to ₱28.7 billion from ₱25.5 billion. Net Interest Income accounted for ₱2.2 billion of the ₱3.2- billion increase while the remaining balance comprised of Fees, Commissions, and Fixed Income trading gains grew by a combined 16 percent or by ₱1.0 billion.

Provisions for losses went up by 3 percent to ₱4.0 billion, slower than the 9 percent increase in its total loan portfolio. Consumer loans increased by 14 percent.

EW remains the most consumer-centric universal bank, with consumer loans accounting for 73 percent of its total loans.

Net Interest Margin (NIM) was at 6.9 percent for the full year, lower than the 7.4 percent it registered in 2018.

Margins recovered to 7.6 percent in the last quarter from the 6.4 percent dip in the first quarter of 2019, where deposit costs went to record highs due to tight market liquidity.

Market liquidity and deposit costs improved considerably in the last 5 months of 2019.

Total deposits meanwhile grew by 6 percent to P304.7 billion, with CASA deposits growing by 28 percent. Overall, total assets grew by 11 percent to end at P406.3 billion.

“We are pleased to report our highest recorded income ever even as the Bank faced a margin squeeze in 2019,” EastWest Chief Executive Tony Moncupa, Jr., said.

He added that, “We expect a reversal in 2020 and recover a good part of the lost margins. Better global and domestic market liquidity should drive deposit costs lower.”

“We also expect our balance sheet to post decent growth as the country is expected to be among the more resilient economies even with COVID-19 and the resulting slowdown in the advanced economies and China,” Moncupa noted.