BDO profit jumps 35% in 9 months

MANILA, Philippines — Earnings of BDO Unibank Inc. jumped by 34.5 percent to P53.99 billion from January to September  versus last year’s P40.16 billion, backed by broad-based growth across its core businesses.

The revenue of the country’s largest bank increased by 21.1 percent to P195.28 billion during the nine-month period from a year-ago level of P161.28 billion.

The bank booked a 27-percent jump in net interest income to P137.43 billion from P108.09 billion, brought about by an expansion in earning asset and improvement in margins arising from the aggressive rate hikes delivered by the Bangko Sentral ng Pilipinas (BSP) to tame inflation and stabilize the local currency.

Likewise, it reported that non-interest earnings inched  by 7.6 percent to P57.85 billion from P53.19 billion , supported by various fee-based and treasury and foreign exchange businesses.

BDO’s service charges, fees and commissions went up by 14.5 percent to P31.71 billion from P27.69 billion from the continued growth in its major service businesses, while it booked a trading gain of P290 million from a trading loss of P2.07 billion.

The country’s biggest bank   said its total operating expenses increased by 16.9 percent to P114.72 billion in end-September   from P98.11 billion a year ago amid higher employee benefits, higher insurance and advertising expenses as well as increased insurance benefits and claims.

BDO reported a 7.5-percent rise in customer loans to P2.7 trillion, while its deposit base grew at a faster rate of 12 percent to P3.4 trillion.

The bank’s non-performing loan (NPL) ratio remained stable at 1.99 percent despite the higher interest rate environment, while NPL coverage improved to 176 percent despite the 12.2 percent decline in the provision for impairment losses to P10.68 billion from P12.16 billion.

“The bank continues to set aside provisions in line with its conservative credit and provisioning policies,” BDO said.

For the third quarter alone, BDO’s net income rose by 16.3 percent to P18.75 billion from P16.12 billion on the back of higher interest and non-interest earnings.

The bank’s common equity increased to P494.3 billion given continued profitable operation, while book value per share (BVPS) increased 13 percent to P93.83.

BDO’s capital adequacy ratio (CAR) and common equity tier 1 (CET1) ratio strengthened to 15.6 percent and 14.5 percent, respectively, well above regulatory minimum levels.