earnings reports

BPI H1 2020 profits down 15%, ups guard vs bad loans

Ralf Rivas
BPI posts lower earnings in the 1st half of 2020 as it sets aside more money for bad loans

Ayala-led Bank of the Philippine Islands (BPI) posted lower earnings in the 1st semester of 2020, as it jacked up the amount set aside for potential bad loans due to the coronavirus pandemic.

From January to June, BPI’s net income stood at P11.7 billion, 15% lower than the P13.7 billion it earned in the same period last year. 

For the 2nd quarter of the year, net income dropped by 24.6% to P5.3 billion from the P7 billion it recorded a year ago.

It booked P15 billion in provisions for loan losses in the 1st semester, as the coronavirus pandemic made it difficult for consumers and businesses to pay up debt. This provision is over 4 times more than the P3.48 billion set aside in the same period in 2019.

The non-performing loans (NPL) ratio stood at 1.83%. The NPL ratio compares the amount of non-performing loans in a bank’s loan portfolio against the total amount of outstanding loans the bank holds. Banks want this figure to be low.

Total revenues jumped by 14.8% to P52.7 billion, while net interest income grew by 12.5%, reaching P36.4 billion. 

Total loans as of June 30 reached P1.43 trillion, 5.9% higher year-on-year, on the back of more loans from the microfinance, corporate, and consumer segments.

Like other businesses of the Ayala Group, BPI has slashed its capital expenditures due to the economic impact of the pandemic. – Rappler.com

Ralf Rivas

A sociologist by heart, a journalist by profession. Ralf is Rappler's business reporter, covering macroeconomy, government finance, companies, and agriculture.