BSP income hits P10.4B as revenues spike

The Bangko Sentral ng Pilipinas (BSP) posted a net income of P10.4 billion at the end of August as revenues jumped by almost a third.

As expenses declined year-on-year, BSP was able to reverse the P1.78-billion net loss it posted at end-August last year, latest data showed.

From January to August this year, the BSP’s revenues grew 32.2 percent to P51.58 billion from P39.01 billion a year ago. The end-August revenue growth was also faster than the 23.6-percent year-on-year increase recorded in the same period last year.

Interest income increased to P31.22 billion from P24.67 billion in 2015, while miscellaneous income amounted P20.36 billion, up from P14.34 billion a year ago.

Meanwhile, end-August expenses slid 3.2 percent to P46 billion from P47.52 billion in the first eight months last year, during which expenses rose 7.3 percent year-on-year.

Interest expenses declined to P29.82 billion from P32.55 billion a year ago, although other expenses increased to P16.18 billion compared to P14.97 billion last year.

End-August net income before gains in foreign exchange rate fluctuations reached P5.58 billion, reversing the P8.51-billion loss a year ago.

Gains on FXR fluctuations, however, declined to P4.82 billion from P6.73 billion during the first eight months of 2015. The BSP explained this amount represented “realized gains or losses from fluctuations in FX rates arising from foreign currency-denominated transactions of the BSP, including: Rollover/re-investments of matured FX investments with foreign financial institutions and FX-denominated government securities; servicing of matured FX obligations of the BSP; and maturity of derivatives instruments.”

In 2015, the BSP’s income grew 14 percent to P56.75 billion, reversing three straight years of decline. Income began dropping in 2012, when BSP recorded only P65.73 billion against the previous year’s P118.74 billion.

In a recent interview, BSP Deputy Governor Diwa C. Guinigundo said a depreciating peso helps the central bank’s bottom line.

“The central bank is a paradox. When we have a growing economy and the peso is appreciating, we lose. But when the exchange rate is depreciating, we gain. That’s where the BSP’s losses and gains come from,” he said.