BDO net income up 10pc to P19.3 billion in first nine months

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BDO Unibank, Inc. (BDO) posted a 10% year-on-year increase in net income to P19.3 billion in the first nine months of the year.

The Bank’s core lending, deposit-taking and fee-based businesses delivered solid results during the period, offsetting a more normalized contribution from Treasury activities.

Net Interest Income (NII) grew 16 per cent to P48.4 billion.

Customer loan portfolio expanded by 15 per cent to P1.4 trillion on broad-based growth across all market segments. Meanwhile, total deposits rose 14 per cent to P1.8 trillion, supported by the 21 per cent increase in low-cost CASA
deposits which now comprise 70 per cent of total deposits.

Fee-based income was up 15 per cent toP16.0 billion, while trading and foreign exchange income normalized to P4.5 billion, or a decline of 29 per cent.

Operating expenses increased by 29 per cent to P52.8 billion, which reflects the consolidation of One Network Bank (ONB) and BDO Life Insurance operations. On a comparable basis net of these new businesses, operating
expenses would have grown by only 12 per cent in line with the Bank’s continued business expansion.

The Bank remained prudent and set asideP2.6 billion in provisions even as asset quality held firm. Gross non-performing loan (NPL) ratio was steady at 1.3 per cent, while NPL cover remained high at 143 per cent.

The Bank’s capital base stood at P215.4 billion, with Common Equity Tier 1 (CET1) and Capital Adequacy Ratio (CAR) both remaining above the current regulatory minimum under the Basel III framework.

The Bank issued last month USD300 million in Fixed Rate Senior Notes at 2.63 per cent, the lowest ever coupon rate for any US Dollar denominated bond for a Philippine issuer.

Further, the Bank recently announced a plan to raise P60 billion in additional core capital through a stock rights offer. The fresh capital will support the Bank’s medium-term growth objectives amid the country’s favorable macroeconomic prospects, and provide a comfortable buffer over higher capital requirements with the forthcoming imposition of the Domestic Systemically Important Bank (DSIB) surcharge.