INQUIRER FILE PHOTO
The country’s leading lender BDO Unibank chalked up P13.3 billion in net profit in the first six months, flat from the level last year, on lower trading gains and one-off items from the acquisition and consolidation of subsidiaries.
Excluding extraordinary items from the consolidation of newly acquired subsidiary BDO Life last year, BDO’s core earnings grew by 16 percent year-on-year in the first half, the bank disclosed to the Philippine Stock Exchange on Monday.
The increase in core earnings was primarily driven by an expansion in loan portfolio, growth in low-cost deposits and higher recurring fee-based service income.
Net interest income in the first six months went up by 22 percent year-on-year to P38.6 billion. This was as the bank expanded its earning assets, with customer loans increasing by 17 percent year-on-year to P1.6 trillion.
Non-interest income amounted to P23.2 billion, driven by fee-based service income. On a comparable basis, fee-based income rose by 13 percent. Insurance premiums advanced by 17 percent year-on-year to P4.6 billion.
On the other hand, trading and foreign exchange gains declined by 21 percent year-on-year to P2.6 billion.
BDO’s operating expenses increased by 20 percent year-on-year, which the bank attributed to its aggressive drive to grow core business along with investments in new markets. Excluding extraordinary items and the consolidation effects of One Network Bank and BDO Life, operating expenses would have risen by only 14 percent, the bank said.
The bank set aside provisions of P2.9 billion even as asset quality remained good. The ratio of bad loans to total loans was steady at 1.3 percent. For every P1 of bad loan incurred, the bank’s loss coverage was high at P1.37.