PNB income drops 7.3% to P2.27B

MANILA, Philippines - Philippine National Bank (PNB) recorded a 7.3-percent drop in net earnings in the first nine months of 2011 to P2.27 billion, from P2.45 billion in the same period last year.

The slight drop in earnings was due mainly to weak gains in trading and investment securities, the bank said in a statement.

Interest income slightly rose to P9.5 billion, attributable to loans and receivables and investment securities, offset by the decrease in income from deposits with other banks.

“Interest expense was slightly up by P400 million to P3.9 billion due to the increase in average daily balance of deposit liabilities,” the bank said.

Fee-based and other income was also lower by 45 percent to P3.1 billion this year from P5.7 billion in the same period last year.

Trading and investment net gains went down by P2.1 billion mainly due to mark to market losses on valuation of investment securities.

Total loan portfolio stood at P129.7 billion or nearly 18 percent higher than the P110 billion in end 2010. Total low cost deposits stood at P185 billion.

Non-performing loans stood at P7 billion.

PNB said administrative and other operating expenses decreased to P7.4 billion from P10 billion last year, due to lower provision for impairment and credit losses, depreciation and amortization, and miscellaneous expense by P2.3 billion.

Consolidated assets stood at P318 billion.

Risk-weighted capital adequacy ratio (CAR) stood at 19.8 percent as of end-September from 19.4 percent in 2010.

Return on equity (ROE) stood at 8.9 percent while return on assets (ROA) was recorded at one percent.

This year, the bank raised P10 billion through a fixed rate unsecured subordinated notes, which qualified as Lower Tier 2 capital.

Last year, PNB reported net earnings of P3.54 billion or a 61-percent increase from P2.2 billion in 2009.