BDO shatters corporate earnings record anew

BDO Unibank Inc. (BDO) recognized as the Philippines’ Best in Cash Management Services by The Asset Triple A Treasurise Awards in Hong Kong, Asian Banking & Finance Awards and Alpha Southeast Asia Best Financial Institution Awards in Singapore.

BDO Unibank Inc. again shattered records after booking the highest nine-month earnings in Philippine corporate history, with other companies “unlikely to beat” the Sy family-led bank that is poised for another banner year.

The banking arm of the SM Group booked a 12-percent growth in net profit in the January to September period to P60.6 billion, driven by its core lending and fee-based service businesses.

Net interest income rose by 8.7 percent to P138.27 billion due to a 13-percent expansion in gross customer loans as all market segments saw growth.

NPL down

Nonperforming loans (NPL) ratio, a key indicator of asset quality, eased to 1.82 percent from 1.99 percent.

“BDO remains well-positioned to capitalize on emerging opportunities and sustain long-term growth and profitability with its strong business franchise, solid balance sheet and extensive distribution network,” BDO said in a stock exchange filing.

Noninterest income, meanwhile, climbed by 16 percent on “robust growth” in fees and service charges, treasury and foreign exchange gains, and income from insurance operations.

Total assets as of end-September stood at P4.8 trillion.

Earnings of the country’s largest bank during the period again represented the highest ever among all companies, according to AP Securities Inc. research head Alfred Benjamin Garcia.

“It’s unlikely that anyone will be able to beat it this earnings season,” Garcia told the Inquirer.

He likewise pointed out that they still expected BDO to end the year with P80.4 billion in total earnings, as it is expected to continue gaining profits from interest rates.

AP Securities’ net income projection for BDO entails an increase of at least 9.53 percent from the bank’s full-year 2023 earnings of P73.4 billion, which was also the highest in country’s history.

The Bangko Sentral ng Pilipinas has so far cut the benchmark interest rate of big banks by a total of 50 basis points to 6 percent. This generally sends a good signal to banks, as lower interest rates are anticipated to increase the demand for loans due to the lower borrowing costs.