BDO partners with Japan’s 16th largest bank

MANILA, Philippines — Sy-led BDO Unibank Inc. has partnered with Japan’s Hyakujushi Bank Ltd. (HBL) to provide banking support services to Japanese clients in the Philippines.

BDO inked a business alliance agreement through a memorandum of understanding (MOU) with Japan’s 16th largest lender and the leading regional bank based in Kagawa Prefecture.

The agreement took effect on April 3 to further strengthen the relationship between the two banks as BDO provides banking support services to Japanese business entities that have existing operations or plan to build or expand their businesses in the Philippines.

HBL expects to grow its roster of customers in the Philippines with new investments and business matching deals.

The Japanese bank has 132 branches, including satellite offices and commercial banking services. It was incorporated in 1878 and has 60,000 corporate clients, mostly located in the industrial zones.

For the past 10 years, BDO has sealed partnerships with several Japanese regional banks strategically situated in various prefectures of Japan.

It has the country’s largest distribution network, with over 1,600 consolidated operating branches and more than 4,600 ATMs nationwide, and has 16 international offices in Asia, Europe, North America and the Middle East.

The earnings of BDO jumped by 33.6 percent to a record P57.2 billion last year from P42.8 billion, driven by robust growth across its core businesses.

BDO reported a 13.6 percent rise in net interest income to P149.23 billion last year from P131.35 billion in 2021 as well as a 16.6-percent increase in non-interest income to P71.53 billion from P61.35 billion bolstered by strong performance of fee income as well as foreign exchange and fixed income client-flow businesses.

Operating expenses of the listed bank grew by 9.4 percent to P131.21 billion from P119.87 billion.

According to BDO, provision for impairment losses slipped by 4.1 percent to P16.37 billion in 2022 from P17.03 billion in 2021 as asset quality improved further.

The bank’s non-performing loan (NPL) ratio improved to 1.95 percent last year from 2.8 percent in 2021, while its NPL coverage strengthened to 167 percent.

BDO’s loans and receivables increased by 9.2 percent to P2.62 trillion from P2.4 trillion on broad-based growth due to the economic reopening with the lifting of strict COVID-19 quarantine and lockdown protocols.

Its deposit base booked a double-digit 14.2-percent growth to P3.22 trillion in 2022 from P2.82 trillion in 2021.