Top lender BDO Unibank, Inc. (BDO) posted a lower net income of P28.2 billion last year from P44.2 billion in 2019, due mainly to pre-emptive provisions of P30.2 billion set aside against potential delinquencies from the pandemic.
In a disclosure to the Philippine Stock Exchange, the Bank said it relied on its strong and resilient business franchise and balance sheet to support core business operations, despite significant hurdles from the pandemic and ensuing economic lockdown.
Net interest income (NII) grew by 12 percent tom P133.7 billion as loans managed to grow 3 percent to P2.3 trillion driven by consumer and corporate accounts.
The Bank continued to assist its borrowing clients, ensuring their uninterrupted access to credit facilities, in addition to granting loan moratoria under Bayanihan I and II.
Current and savings accounts deposits continued to climb, growing 17 percent to P2.1 trillion, as clients were able to access BDO products and services through its branches, ATMs and digital channels even during quarantine restrictions.
Non-interest income declined 8 percent and settled at P55.2 billion, supported by fee-based income, trading gains and insurance premiums. Business volumes were initially impacted by mobility restrictions, but have since begun to recover gradually.
Wealth management, on the other hand, remained resilient with trust volumes and fees sustaining growth.
Trading gains increased as the Bank capitalized on favorable market conditions while insurance premiums grew modestly despite the initial impact of the lockdowns.
The Bank’s provisions of P30.2 billion were in line with prudent credit and provisioning policies, meant to further strengthen its balance sheet.
The NPL ratio stood at 2.65 percent with NPL coverage at 109.5 percent. As of yearend, the Bank’s total Loan Loss Reserves were equivalent to 3 percent of Gross Customer Loans, and are considered more than sufficient to cover for potential losses.
BDO said it remains cautiously optimistic on a gradual upturn in 2021. With its extensive market reach and devoted workforce, the Bank remains committed to providing banking products and services attuned to its customers needs.
These include digital upgrades that allow easier and safer access to services, such as QR code-based ATM and merchant transactions.
These are part of the benefits expected from its ongoing Next Generation IT upgrade.