Philippine National Bank (PNB) reported a five percent increase in first-quarter net income, buoyed by higher lending volumes and a focus on cost containment that helped the lender navigate a volatile interest-rate environment.

In a disclosure to the Philippine Stock Exchange, PNB said the lender earned ₱6.37 billion in the three months through March, underpinned by a six percent rise in both net interest income and fee-based revenue, driven by measured expansion of its revenue base.

PNB, the country's sixth-largest private domestic bank by assets, saw its total loan portfolio expand 15 percent from a year earlier on the back of aggressive lending even as the Bangko Sentral ng Pilipinas maintained a restrictive monetary policy stance to combat inflation.

Despite the increase in credit deployment, the bank’s asset quality remained stable, with its non-performing loan ratio recorded at 4.78 percent.

“Despite global economic headwinds, we delivered solid first-quarter progress on the back of a strong balance sheet and growing core income,” Edwin Bautista, PNB president and chief executive officer said.

Bautista noted that the bank is prioritizing “tighter cost control” and asset quality while investing in artificial intelligence and digital platforms to maintain competitiveness.

The bank’s deposit base reached ₱1.01 trillion during the period. Crucially, PNB maintained a high proportion of low-cost funding, with current and savings accounts—known as CASA—accounting for 80 percent of total deposits. This funding structure provides a buffer against rising interest expenses that have pressured margins across the Philippine banking sector.

Profitability metrics remained resilient, with return on equity standing at 10.8 percent.

Francis Albalate, PNB chief financial officer, attributed a solid return on assets of 1.91 percent to “efficient asset deployment” and a balanced loan mix. The bank’s capital position recently earned an affirmation of its investment-grade credit rating from Moody’s Ratings, which highlighted PNB’s capital buffers as the strongest among its local peers.

The lender also maintained its standing in the capital markets, recently being named the top fixed-income brokering participant by the Philippine Dealing System Group for the third consecutive year. (James A. Loyola)