BDO nets record income in 2015: P25B

MANILA, Philippines – The Sy family-led BDO Unibank Incorporated (BDO) saw its net income for the full year 2015 increase by 10% to P25 billion, the highest it’s ever recorded.

The bank attributed the performance to growth in all its  business segments and expansion headlined by its acquisition of One Network Bank (ONB) in July 2015, which added 107 branches to its network.

Besides the ONB branches, BDO also opened 46 branches in 2015, 8% of which were outside the National Capital Region.

BDO president Nestor Tan pointed out that the bank’s growth outpaced the industry.

Down in Q1 2016

For the first quarter of 2016, the bank reported a net income of P5.5 billion, down 9.8% from the P6.1 billion recorded the same time last year.

The drop was due to lower trading and foreign exchange gains at P1.5 billion against the P3.4 billion recorded in Q1 of 2015. BDO attributed the fall to “unfavorable market conditions”.

This was partially offset by growth in traditional banking activates; core lending, deposit-taking, as well as fee-generating businesses.

Net interest income grew by 17% to P15.5 billion helped by a 15% jump in customer loans P1.3 trillion. The bank also posted a 14% growth in deposits to P1.7 trillion, driven by a 23% increase in low-cost deposits.

Fee based income from payments, transactions and asset management also increased by 11% to P4.8 billion.

The bank’s cover for non-performing loans (NPL) stood at 163% with P827 billion set aside for the first quarter.

BDO reported a capital base of P204 billion with its Capital Adequacy Ratio (CAR) at 13.4%, Tier 1 capital ratio at 11.8% and Common Equity Tier 1 (CET1) at 11..4%, which are all above the minimum requirements dictated by the Basel III framework.

Earlier this year, the bank paid a cash divided P0.30 on common shares for Q1 2016.

It also set an net income target of P26 billion for 2016 on the expectation that its treasury will normalize over the course of this year.

Strategic expansion

Besides the acquisition of ONB, BDO started a number of strategic moves last year.

The bank acquired full ownership of the life insurance business of Generali Pilipinas Holdings Company which is pending regulatory approval. It also set up online stock trading platform through a joint venture with Nomura Holdings.

The bank, through its BDO Leasing and Finance Division also plans to tie-up with Mitsubishi Motors Philippines Corporation (MMPC), Sojitz Corporation and JACCS Corporation Limited to provide financing for Mitsubishi Vehicles.

MMPC recently announced plans to expand production in the country. – Rappler.com