By James A. Loyola EastWest Banking Corporation (EW) reported a 75 percent surge in net income to ₱2.3 billion last year even though it increased loan loss provisions by ₱1.6 billion to 2.4 billion, 2.8 times higher from last year in anticipation of COVID-19 fall out. In a disclosure, the bank said its higher income in the first three months of 2020 was driven by better margins from its core lending and deposit-taking business and higher trading gains. Net revenues rose by 45 percent to ₱9.6 billion from ₱6.6 billion in the same period last year. Net interest income, accounting for 69 percent of revenues, increased by 42 percent or ₱1.9 billion. Net Interest Margin (NIM) was at 8.1 percent, 173 bps higher from 2019 as market liquidity, and deposit rates normalized. In the early part of 2019, deposit costs were substantially higher and pushed bank’s margins lower. Non-interest income, on the other hand, increased by 52 percent or ₱1.0 billion, mainly driven by securities trading gains. "We were looking forward to another record year, at least ₱8.0 billion in income for 2020 – until COVID-19 struck. Now, we have to be ready that profits could be lower this year,” said EastWest Bank Chief Executive Tony Moncupa. He added that, “We have to book ‘anticipative provisions’ for loan losses and may need to continue doing so in the coming months as the economic damage to households and businesses from the virus-induced disruption unfolds.” EW’s Total Assets stood at ₱384.1 billion or 3 percent higher from the same period last year. Total loans increased by ₱15.2 billion or 6 percent higher to end at ₱261.4 billion. The bank’s Asset and Loan growth for the quarter were among its lowest in years, partly due to less aggressive lending in consideration of the virus. With less assets to fund, deposits increased by only 3 percent to ₱294.3 billion as the Bank just “replaced its time deposits with low-cost funds,” EW reported. The latter partly accounts for the improvement in margins.