East West Bank profit soars 41%

MANILA, Philippines - Gotianun-owned East West Banking Corp. said its net income rose four percent to P1.28 billion in the first six months of 2013, from P910 million in the same period last year.

EastWest Bank president and chief executive officer Antonio C. Moncupa Jr. said the bank has gained momentum from the strong domestic economy.

“We remain confident that we will meet this year’s 25-percent net income growth guidance we announced early this year,” Moncupa said in a statement.

That would translate to a full-year net income of P2.25 billion, from its 2012 earnings of P1.8 billion.

“Revenues grew by 59 percent to P7.1 billion and assets by 41 percent to P130.9 billion. This translates to a return on equity of 14.2 percent and return on assets of 2.1 percent,” he added.

Revenue growth was due to the 51.5- percent increase in loan receivables.

Total loans to businesses, mostly to medium-sized corporates, went up 60 percent from last year.

Consumer loans increased 45 percent to P44.6 billion. All consumer loan segments – credit card receivables, personal loans, auto, and mortgages – registered high double-digit growth. The bank is now the fifth largest in credit card receivables.

Total deposits for the first semester of 2013 stood at P101.5 billion, up 50 percent.

Transactional low-cost deposits (checking accounts/savings accounts) grew 61.5 percent to P58.1 billion.

Non-interest revenues grew 87.4 percent from fees, commissions and trading. Total fees, excluding trading, was up 62.7 percent in end-June to P1.6 billion while fixed income and foreign exchange (forex) trading revenues, on the other hand, went up 121.9 percent.

Meanwhile, total expenses rose 51.7 percent to P4.2 billion. Operating costs was higher by 42.1 percent due to its expanding branch network. Moreover, total manpower expenses went up 73 percent to P1.5 billion.

Capital adequacy ratio (CAR) remains more than adequate at 16.8 percent, with Tier 1 ratio at 13.5 percent. The bank’s Tier 1 capital is composed entirely of common equity.

Last year, EastWest Bank went public, raising P4.8 billion in new equity to fund an expansion that will bring its branch network from 122 in December 2011 to 400 by the first quarter of 2014.

To date, the bank has a total branch network of 324 and total ATMs of 386, after opening 32 branches over the past seven months.