BDO Q1 net profit up 40% to P16.5-B
BDO Unibank [BDO 129.50 1.3%; 150% avgVol] [link] reported a Q1/23 net profit of P16.5 billion, which was up 40% from its Q1/22 net profit of P11.7 billion.
BDO reported that its net interest income grew 28% y/y to P43.4 billion, and that its net interest margin improved to 4.58%, which BDO attributed to the general rise in interest rates.
BDO said that its core businesses “continue to deliver broad-based growth”. Gross customer loans increased 8%. Total deposits increased 14%.
Both interest and non-interest income was up. BDO did note that its operating expenses were up 17% y/y, but said that this increase was tied to volume-related costs like credit card interchange fees, where the operating expense expands in lockstep with the bank’s anticipated profit from each transaction.
BDO’s President and CEO, Nestor Tan, said: “We’re seeing positive signs. However, we’re not yet sure we’re out of the woods because a lot of the factors affecting us are not within our control.“
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What could Mr. Tan possibly be worried about? BDO posted its most profitable year ever in 2022. Not just “since the pandemic”, but “ever”.
While this Q1 net income result is down like 3% q/q from BDO’s monstrous Q4/22 net income of P17 billion, this is probably the best run of profit that the bank has ever seen. Positive signs? What kind of signs are you waiting for, Mr. Tan?
You run a bank that is always subject to external factors that you cannot control, you’re always technically “in the woods” so to speak with respect to interest rates and global conflict, and yet, despite all that, here we are writing about BDO’s incredible performance.
Perhaps it’s a bit of necessary PR to make it seem like the banks are struggling alongside the average Filipino with these higher rates and inflation, when it’s actually pretty clear that the environment has been a profit machine for the industry.
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Merkado Barkada's opinions are provided for informational purposes only, and should not be considered a recommendation to buy or sell any particular stock. These daily articles are not updated with new information, so each investor must do his or her own due diligence before trading, as the facts and figures in each particular article may have changed.
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