Filinvest holding firm earns 27% less

MANILA, Philippines - The investment holding firm of the Gotianun family recorded lower earnings in the first quarter, weighed down by lower income contribution from its banking unit.

In a regulatory filing, Filinvest Development Corp. (FDC) said its net income sank 27 percent to P701. 29 million from P966.34 million a year ago.

“FDC registered total consolidated revenues and other income of P9.05 billion in the first quarter, slightly higher than the same quarter last year of P9.01 billion,” the company said.

“Topline growth of most subsidiaries remained strong, led by the real estate business, which includes listed subsidiary Filinvest Land Inc. (FLI) and Filinvest City developer Filinvest Alabang Inc., posting a year-on-year gain of 11 percent in revenues to P4.22 billion from P3.81 billion in the first quarter,” it added.

The improvement in real estate revenue was driven by growth across all types of construction: high rise buildings, mid-rise buildings and horizontal housing, the holding firm said, adding that mall and rental revenues rose due to higher rental rates and additional leasing area.

For its part, subsidiary EastWest Bank recorded a 38-percent decrease in net income to P455.7 million as it recorded a P756-million drop in trading income in the first quarter.

But net interest income jumped 24 percent to P2.3 billion as a result of strong growth in its loan portfolio that focused on consumer and middle-market segments.

“We have always aimed to focus and grow net interest income at EastWest Bank as this is considered our core business, a more steady and regular revenue source and a positive indicator of what we can expect in the future,” said FDC president and CEO Josephine Gotianun-Yap.

FDC chairman Jonathan Gotianun said EastWest Bank is at the height of its branch  expansion program.

“We have already reached 376 stores and expect to attain 400 by yearend.  The expansion program will temporarily put pressure on the bank’s earnings but will catapult it to higher levels once the branches become more productive and mature,” he said.