Landbank profit up 22% to P765M in first quarter

The Land Bank of the Philippines’ (Landbank) net income improved by 22 percent to P765 million in the first quarter of the year compared to P625 million posted during the same period in 2004 on the back of increased revenues from loans and investments.

"We are P140 million ahead of our P625-million net income target for the first quarter of the year. At the rate we’re going, we’re optimistic we can hit our full-year net income target of P2.5 billion for 2005," Landbank president and chief executive officer Gary B. Teves said yesterday.

Teves said the bank’s gross revenues from January to March this year was up 19 percent from P4.9 billion during the same period last year to P9.5 billion while loan revenues expanded by 27 percent to P2.8 billion from P2.22 billion last year.

For the first quarter, Landbank’s total expenses rose 21 percent to P5.2 billion from P4.3 billion.

Teves noted that the bank’s total assets went down slightly by one percent to P283.1 billion due to the P4.3-billion reduction in the investment portfolio.

On the other hand, increased in deposits was not significant, rising slightly by P1 billion to P215 billion from P213.8 billion during the period.

Teves noted that Landbank’s non-performing loan (NPL) ratio improved significantly to 7.2 percent from 13.9 percent which is better than the industry average of 12.5 percent.

He attributed the improved NPL ratio to the successful sale towards end 2004 of the bank’s non-performing loans worth P13.5 billion under the Special Purpose Asset Vehicle Law (SPAV).

At the same time, the bank’s non-performing loans also went down from P20.2 billion during the first quarter of 2004 to P10 billion this year, while its real and other properties owned or acquired decreased from P17.4 billion to P16.4 billion.

"With a good start in the first quarter, we are confident that we can dispose of our remaining non-performing assets this year to improved our NPA ratio to 9.8 percent," said Teves.