China Bank posts 10% profit growth
Sy family-led China Bank Corp. boosted its six-month net profit by 10 percent year-on-year to P3.6 billion, driven by its robust lending business and other recurring income.
This first semester performance translated to a return on equity and return on assets of 10.44 percent and 1.13 percent, respectively, the bank said in a regulatory filing.
China Bank’s net interest revenue grew by 16 percent year-on-year to P9.2 billion, while non-interest revenue went up by 6 percent to P3.1 billion as the drop in trading gains was offset by the growth in service charges, fees from bancassurance, investment banking and trust, and income from asset sales.
Excluding trading gains and one-off items, operating income grew by 18 percent compared to last year, attributed by the bank to continued robust growth in earnings from core businesses.
“The results for the first half of the year is an encouraging indication of China Bank team’s ability to execute on our strategic direction of strengthening our core businesses while achieving revenue diversification, ” China Bank president and chief executive officer Ricardo Chua said.
“The network expansion started 10 years ago continues apace, while the substantial investments in recent acquisitions and subsequent integration are starting to bear fruit,” Chua said.
China Bank grew its loan book by 22 percent to P401.7 billion, outpacing industry expansion, as all segments expanded strongly. Consumer loans grew by 25 percent while commercial loans rose by 10 percent. Loans to the corporate segment also grew by 25 percent, perked up by deals generated by China Bank Capital.
Despite the expansion in risk assets, China Bank maintained asset quality, with bad loans ending at 1.81 percent of total loans compared to the industry average of 1.94 percent. Consolidated non-performing loan coverage ratio stood at 92.8 percent.
Total assets reached P657.5 billion, up 18 percent year-on-year as the bank’s customer base and market share grew with the expansion of its branch network.
China Bank has 563 branches at present, more than triple its branch network in 2006. Of these, 156 are branches of China Bank Savings.
The growth in asset base was funded by a 20-percent growth in total deposits to P554 billion, supported by a 19-percent growth in low-cost checking and savings deposits. —DORIS DUMLAO-ABADILLA
