BPI net income up slightly to P22.42 billion in 2017

MANILA, Philippines – Ayala-led Bank of the Philippine Islands (BPI) saw its net income inch up slightly last year compared to 2016, boosted by strong performance in the 4th quarter.

In a disclosure to the Philippine Stock Exchange (PSE) on Monday, February 5, the bank announced a net income of P22.42 billion for full-year 2017, up 1.7% from its bottom line in 2016.

BPI pointed out, however, that the year-on-year improvement would’ve been higher excluding one-off gains from the sale of securities in 2016 which would’ve seen it post a higher increase of 3.1%.

The bank reported total revenues of P71.02 billion in 2017, up 6.7% as net interest income increased to P48.04 billion, rising 13.4% as a result of asset growth and improvement in net interest margin.

Non-interest income, on the other hand, dropped by 4.9% to P22.98 billion, without the one-off trading gains recorded in 2016.

BPI noted that this was partially offset by higher fee-based income which hit P19.9 billion, up 15.6% year-on-year, due to higher credit card fees, trust and investment management fees, insurance fees, bank commissions, and service charges.

The bank cost-to-income ratio hit 54.3%, slightly higher compared to 52.5% in 2016, driven mainly by digitalization initiatives. Its return on equity was 12.8% and return on assets was 1.3%, slightly lower by 1.0 and 0.12 percentage points, respectively.

Operating expenses for the year totaled P38.53 billion, up 10.3%,  which the bank explained was due to spending on technology, operations, and increased marketing. (READ: BPI on June 6 glitch: ‘100% not a hack’)

Eventful last few months

A strong showing in the final 3 months of 2017 helped BPI get over the line with the bank seeing an improvement of 14.9% to P5.37 billion from P4.67 billion in the same period in 2016.

It was during this period where the bank raised P12.24 billion from its offering of Long-Term Negotiable Certificates of Time Deposit (LTNCTD), the largest the Philippines’ banking industry has seen so far.

Last November, BPI also announced its Business Banking Segment, a new client group which is geared towards small- and medium-scale enterprises (SMEs). Formal operations started at the beginning of this year.

BPI is the Philippines’ 3rd largest bank in terms of assets which it saw increase by 10.3% to P1.90 trillion in 2017. Its total capital reached P180.69 billion, up 9.4%, which includes P7.09 billion in cash dividends paid for the year.

Its Capital Adequacy Ratio (CAR) was at 12.74% and Common Equity Tier 1 (CET1) was at 11.84%, both lower by 0.26 percentage points, respectively.

“We come out of 2017 stronger than ever,” said BPI president and chief executive officer Cezar Consing in a statement.

“While the bank has grown significantly in the past several years, we intend to continue to invest in people, technology, and branches to support and benefit from a surging Philippine economy. Inclusive, profitable growth will be our focus,” he added. – Rappler.com