Major Philippine banks ended September with higher profits as the cost of holding deposits remained low while lending rose sharply, disclosures this week showed.
This continued a reversal from last year’s industry-wide profit slump—a result of volatile interest rates eating into bottom lines.
Bank of the Philippine Islands (BPI), the latest of the industry’s three leaders to release quarterly results, on Wednesday said its net income rose to P13.84 billion in the nine months to September. BPI is the country’s third-largest bank.
Total revenues increased by P3.67 billion, or by 9.1 percent, to P44.10 billion, as both net interest income and non-interest income grew by P2.98 billion and P680 million, respectively.
Both total loans and total deposits grew in the double digits year-on-year. Total loans stood at P780.07 billion, with a 76.6 percent-23.4 percent corporate-retail mix. Total loans grew 11.2 percent.
Gross non-performing loans rose slightly to 1.9 percent from 1.8 percent of total loans, while loan loss cover remained at 107 percent.
Total deposits stood at P1.18 trillion, 13.3 percent higher year-on-year. Most of this was made up of cheap current and savings account (CASA) deposits, which accounted for 72.5 percent.
Earlier this week, Metropolitan Bank & Trust Co., the industry’s number two, reported a 25-percent increase year-on-year in core earnings in January to September.
With a stronger focus on low cost deposit generation, CASA increased by 14 percent to P652.6 billion, while consolidated deposits settled at P1.2 trillion as of September. The bank said it saw a 10-percent increase in outstanding net loans and receivables to P768.9 billion.
For the nine months of the year, Metrobank booked P36.3 billion in net interest income, which now comprises over 70 percent of total operating income.
On the other hand, market leader BDO Unibank late last month said its profits rose to P17.6 billion at the end of September from P16.7 billion last year.