Trading gains boost BPI’s Q1 earnings

Ayala-led Bank of the Philippine Islands grew its first quarter net profit year-on-year by 43 percent to P8.4 billion on the back of higher trading gains and net interest income.

This means that the bank has delivered early in the year 48.7 percent of the P17.25 billion net profit expected by the market for 2013. But BPI has lost—at least for the first quarter—the bragging rights of being the country’s most profitable bank as Banco de Oro Unibank posted a record-high bottom-line of P10 billion during the same period.

“The improvement in net income for the period was driven by the 21 percent growth in total revenues as the bank took advantage of the favorable market condition to register securities trading gains,” BPI said in a press statement on Thursday.

BPI said its net interest income was “slightly up,” as average asset base expanded by 15 percent. “Net yields though, contracted as interest rates continued to decline,” the bank said.

“Other non-interest income lines likewise improved, particularly service charges and commissions, trust fees, and corporate finance fees,” it said. No details were provided on the increase in interest earnings and trading gains.

The bank grew its net loan book by 19 percent year-on-year to P514 billion. Lending to top corporates went up by 25 percent, while the middle market and small and medium enterprise segments went up by 17 percent and 14 percent, respectively. Consumer loans also grew by 15 percent.

On asset quality, BPI’s gross 30-day non-performing loan ratio was down to 2.1 percent from last year’s 2.5 percent. Reserve cover was 129 percent.

Meanwhile, operating costs reached P6.6 billion or 7 percent more year-on-year due to higher regulatory, technology, manpower and variable costs, the bank said. Impairment losses, however, were down from last year.