BDO end-Sept profit surges 49.3% to P32.1B

The country’s leading lender BDO Unibank grew its net profit in the first nine months by 49.3 percent year-on-year to P32.1 billion on higher interest earnings, fee-based income and a resurgence in treasury gains.

This translated to a return on common equity of 12.5 percent, improving from 9.5 percent in the same period last year, BDO disclosed to the Philippine Stock Exchange on Monday.

BDO increased its net interest income by 23.8 percent year-on-year to P88.5 billion in the first nine months. This was as the bank improved its margins and grew its loan book by 6 percent year-on-year to P2.1 trillion, led by the sustained growth in the middle-market and consumer segments.

Nine-month non-interest income also went up by 23 percent year-on-year to P44.1 billion, led by fee-based income and insurance premiums which accelerated by 14 percent and 23 percent to P25.4 billion and P10.8 billion, respectively.

Trading and foreign exchange gains for the nine-month period also surged to P4.3 billion from P964 million in the same period last year. This year’s treasury windfall “reflects a normalized level compared to 2018, where a more volatile environment prevailed,” the bank said.

For the third quarter alone, trading and foreign exchange gains amounted to P690 million, compared to P1 billion in the same period last year.

Meanwhile, operating expenses rose by 20 percent to P85.8 billion, which the bank attributed to its continuing expansion as well as increased volume-related expenses.

Bad loans as a ratio of total assets was steady at 1.2 percent.

On the funding side, BDO’s total deposits went up by 3 percent to P2.4 trillion, with low-cost deposits rising by 6 percent and accounting for 72 percent of total deposits. —DORIS DUMLAO-ABADILLA