BDO income climbs 12 percent to P39.4 billion in H1

MANILA, Philippines — The Sy family-led BDO Unibank Inc. grew its profit by 12 percent to P39.4 billion in the first half, from P35.2 billion in the same period last year, on the back of strong momentum from its core intermediation and fee-based service business.

For the second quarter alone, the bank’s net income also rose by 11.9 percent to P20.9 billion from P18.7 billion previously.

“BDO’s robust business franchise and strong balance sheet place the bank in a suitable position to capitalize on emerging opportunities to sustain attractive long-term growth and profitability,” the bank said in a statement.

In a regulatory filing, the country’s largest lender reported an 11-percent rise in net interest income to P99.6 billion in the first half due to an expansion in earnings assets.

The bank’s other operating income grew by 13 percent to P43.3 billion. This, as foreign exchange gains more than doubled to P5.1 billion while service charges and fees went up by 11 percent to P23.1 billion on continued growth from major business services.

Trust fees also rose by eight percent to P2.5 billion amid an improved portfolio mix of funds managed. Insurance premiums increased by five percent owing to higher BDO Life business volumes.

Other income surged by 69 percent to P4.1 billion, mainly driven by rental income of the Podium Complex, Inc.

BDO reported a 15 percent increase in operating expenses to P86.5 billion, as employee benefits rose by 13 percent from salary increases and higher manpower headcount. Occupancy costs also climbed by 14 percent.

The bank’s total resources grew by 13 percent to P4.7 trillion from growth in customer loans and investment securities mainly funded by deposits.

The lender’s total customer loans expanded by 13 percent across all market segments, while total deposits rose 13 percent. BDO’s current account, savings account (CASA) ratio stood at 69 percent as of end-June.

Despite higher consumer loans, BDO’s asset quality remained stable amid a high interest rate environment. Non-performing loan (NPL) ratio settled at 2.06 percent, while NPL coverage stood at 169 percent.

Last week, BDO raised P55.7 billion from its third foray into the ASEAN sustainability bond market, targeting to finance and/or refinance eligible projects to further aid the country’s sustainable development.

The amount was more than 11 times oversubscribed from the original size of P5 billion. The offer period was shortened by three days amid the rapid buildup in orders from retail and institutional investors.

BDO, the largest bank in terms of total assets, loans, deposits and trust funds under management, has over 1,700 consolidated operating branches and more than 5,500 ATMs nationwide.

It also has 16 international offices, including full-service branches in Asia, Europe, North America and the Middle East.