MANILA, Philippines — Ayala-led Bank of the Philippine Islands (BPI) posted a 60 percent jump in net income to P8 billion in the first quarter of the year from P5 billion in the same quarter last year.
In a disclosure to the Philippine Stock Exchange (PSE), the country’s fourth largest lender in terms of assets said total revenues climbed by 4.3 percent to P25.4 billion from January to March this year compared to P24.3 billion in the same period last year.
According to BPI, the strong performance in the first quarter could be attributed to higher net interest income, as well as lower loss provisions.
The bank’s net interest income increased by 12.7 percent to P19 billion from 16.9 billion as net interest margin rose by 11 basis points to 3.42 percent.
However, BPI reported a 14.5 percent decline in non-interest income to P6.4 billion from P7.4 billion amid lower securities trading gains, service charges, bank commissions, and underwriting fees.
The 2.2 times rebound in foreign exchange trading gains to P702.1 million was not enough to offset the decline in non-interest earnings.
The bank also cited the normalized tax expenses after last year’s one-time tax adjustments upon effectivity of Republic Act 11534 or the Corporate Recovery and Tax Incentives for Enterprise Act (CREATE) Law.
Expenses went up by 6.5 percent to P12.6 billion in the first quarter from P11.8 billion in the same quarter last year due to broad increases in all cost categories as the volume of transactions picked up given the economic reopening and relaxed mobility restrictions.
The provision for credit losses made by the 170-year old bank from January to March this year was 30.6 percent lower at P2.5 billion versus a year-ago level of P3.6 billion.
The bank also reported an improvement in non-performing loan (NPL) ratio to 2.38 percent from 2.49 percent in end-December and 2.76 percent in end March last year, while NPL coverage ratio increased to 149.6 percent from 123.5 percent.
BPI’s loan book expanded by 7.1 percent to P1.5 trillion in end March from P1.4 trillion last year. It recorded higher loan volumes across the board, led by the 7.7 percent growth in the corporate lending, 6.6 percent rise in mortgage, and 12.2 percent jump in credit card portfolio.
Likewise, its deposit base rose by 13.1 percent to P1.9 trillion from P1.7 trillion.
According to BPI, total assets grew by 9.9 percent to P2.4 trillion from P2.2 trillion, while total equity increased by 6.8 percent to P300 billion from P280.8 billion.
The bank’s common equity Tier 1 ratio stood at 16.2 percent, while its capital adequacy ratio stood at 17 percent.
As of end March, the lender recorded a return on equity of 11 percent and a return on assets of 1.36 percent.