PNB Q1 earnings up 15% on growth of loan portfolio

Philippine National Bank is off to a great start after posting a 15-percent rise in first quarter income to P6.1 billion. — INQUIRER.net photo

MANILA, Philippines – Philippine National Bank (PNB) grew its earnings in the first quarter by 15 percent to P6.1 billion as its loan book expanded while trading and foreign exchange gains increased.

In a stock exchange filing on Monday, the banking arm of the Lucio Tan Group said net interest income in the first three months reached P12.71 billion, up by 8.7 percent versus the same period last year.

Core income, which excludes nonrecurring gains from the sale of foreclosed properties, jumped by 10 percent to P14.1 billion.

READ: Moody’s upgrades PNB credit rating

“The first quarter financial results this year reflect the strength of PNB’s franchise in its wholesale and retail business,” outgoing PNB president Florido Casuela said.

“We expect that the quality of the bank’s earnings will further improve since we have already put in place the necessary foundation for the bank’s sustained stability and accelerated growth,” Casuela added.

Other income surged by 58 percent to P1.9 billion due to gains from trading and foreign exchange transactions.

Operating expenses jumped by a tenth to P8.1 billion on growth in the consumer business segment.

Meanwhile, a 55-percent decline in expenses for bad loans to P277 million likewise contributed to profitability.

As of end-March, the assets of PNB, the country’s eighth largest bank, stood at P1.28 trillion.

Earlier this month, Moody’s Ratings upgraded its credit rating for PNB from “Baa3” to “Baa2,” or equivalent to the Philippine government’s score. This means that although there is a certain level of risk, PNB is believed to be creditworthy and expected to meet its financial commitments.

The credit rating agency likewise changed its outlook on PNB from “positive” to “stable,” meaning its current rating was unlikely to change within the next 12 to 24 months.

PNB is set to begin a leadership shift today, April 29, during which Edwin Bautista will begin his term as the bank’s new president.

Bautista was formerly the president of Aboitiz-led Union Bank of the Philippines. Casuela, meanwhile, will “focus on personal businesses” while taking a “less active role” at PNB as board advisor.