The Philippine National Bank (PNB) posted record consolidated net income of ₱25.3 billion last year, a 20 percent increase from the ₱21.2 billion reported a year earlier amid aggressive loan expansion and improved cost efficiencies.

In a disclosure to the Philippine Stock Exchange, the lender controlled by billionaire Lucio Tan reported that the surge in profitability pushed PNB’s return on equity to 11.1 percent, up 70 basis points from 2024 on the back of shifting interest rate environment and volatile market conditions.

Francis Albalate, PNB chief financial officer, said the robust 2025 performance was due to “strengthened vigor” in revenue generation.

In particular, he noted that fee-based businesses—ranging from credit cards and trust operations to bancassurance—provided diversified earnings base that shielded the bottom line from over-reliance on traditional lending spreads.

According to Albalate, the gains also reflect deepening of the PNB franchise and broader customer confidence across its retail and corporate segments.

The bank’s total loan book expanded by 15 percent year-on-year, spearheaded by a 27 percent jump in consumer lending. Corporate and commercial credit, which remains the backbone of PNB’s portfolio, grew by 13 percent.

PNB’s lending momentum, combined with a low-cost funding base, enabled it to maintain a net interest margin of 4.51 percent. On the funding side, deposits breached the ₱1 trillion milestone, ending the year at ₱1.06 trillion, a nine percent rise from December 2024.

Asset quality improved markedly, with the bank’s non-performing loan ratio dropping to 4.7 percent from 5.7 percent the previous year. Management credited this decline to a stabilization strategy that utilized dynamic risk-scoring and more frequent portfolio reviews. The bank also engaged in “active intervention” with its larger commercial clients to resolve accounts before they soured.

Efficiency gains further bolstered the results. Operating expenses grew at a much slower pace than total income, narrowing the cost-to-income ratio to 48.2 percent from 49.6 percent.

Edwin Bautista, PNB president and chief executive officer, said the bank has now moved past the heavy lifting of its technological overhaul, including a modernized core banking system and ATM switch, which resulted in a 26 percent increase in the bank’s mobile app user base.