PNB earnings up 17% to P14.6 billion in H1

MANILA, Philippines —  Lucio Tan-led Philippine National Bank (PNB) posted a 17-percent increase in first-half net income as stronger lending activity, higher fee-based revenues and improving asset quality helped offset a volatile operating environment.

The listed bank said yesterday that net income reached P14.6 billion during the six-month period from P12.5 billion in the same period last year.

The stronger earnings lifted its return on equity to 12.1 percent from 11.4 percent a year ago.

Operating revenue increased by P3.3 billion, driven by a seven percent rise in net interest income. Interest income from loans climbed by 12 percent while the cost of deposits fell by 24 percent. Fee-based income also grew by 17 percent, led by higher bancassurance revenues.

PNB president and CEO Edwin Bautista said the results reflected the bank’s ability to grow earnings while maintaining a healthy balance sheet.

“As PNB celebrates its 110th anniversary, our strong first-half performance highlights the strength and resilience of our franchise,” Bautista said.

“We delivered improved profitability, increased our loans and significantly reduced our non-performing loan (NPL) ratio. Demonstrating the quality of our balance sheet and disciplined execution,” he said.

The bank’s asset quality continued to improve during the period, with its gross NPL ratio declining to 4.2 percent from 5.5 percent a year earlier as credit costs eased.

PNB’s total assets expanded by 4.4 percent to P1.35 trillion from P1.29 trillion a year ago, supported by continued loan growth.

Its loan portfolio increased by 10 percent to P764 billion from P696 billion. Corporate and commercial loans rose by 11 percent while consumer loans grew at a faster 21 percent pace.

PNB chief financial officer Francis Albalate said most of the increase in consumer lending came from lower-risk segments.

“About 90 percent of consumer loan expansion during the first half of the year was in the secured lending area, particularly housing loans. We are not seeing any deterioration in the portfolio’s credit quality despite the current market environment,” Albalate said.

The bank also became more efficient during the period, with its cost-to-income ratio improving to 48.7 percent from 49.3 percent a year ago. PNB said continued investments in the business were offset by efficiency initiatives and improvements in branch operations.

Despite financial market volatility, Bautista said the lender remains well positioned to sustain growth.

“As we continue our role in nation-building, we are also advancing our artificial intelligence transformation journey with more than 90 percent of our employees trained in AI, reinforcing our commitment to responsible AI governance, innovation and a future-ready workforce,” he said.

The bank said it continues to maintain a strong capital position, ending June with a common equity tier 1 ratio of 19.4 percent and a capital adequacy ratio of 20.3 percent, providing ample buffers to support future lending and business expansion.