BPI income surges 38% to P7.3 billion in 9 months

MANILA, Philippines - Ayala-owned Bank of the Philippine Islands (BPI) generated a net income of P7.3 billion in the first nine months of 2009, a 38-percent increase from a year ago, due to a marked improvement in revenues, the bank said in a statement yesterday.

In its disclosure to the Philippine Stock Exchange, BPI said it earned P2.1 billion in the third quarter alone, 35 percent higher than last year, despite an additional impairment loss of P100 million for typhoon related accounts and higher manpower costs from the increased retirement fund expense, as well as collective bargaining agreement (CBA) related payments.

In the nine-month period, BPI said tota revenues grew 16 percent as both net interest income and non-interest income grew 14 percent and 20 percent, respectively.   

“The growth in net interest income was brought about by an eight percent expansion in average asset base as well as a 13 basis points widening in net spreads,” the bank said.

It noted that non-interest income was ahead of last year despite lower profits from asset sales. “This was due to a major turnaround in income from foreign exchange and securities trading which recorded some trading losses last year.”  

It added that non-interest income benefited from the declining interest rate environment which provided the bank the opportunity to sell down part of its securities inventory and generate bigger trading gains. Service charges and commissions, and insurance income likewise posted increases.

BPI said average loans and deposits grew eight percent and seven percent, respectively. In addition, loan yields improved by 27 basis points coupled with a decrease in funding cost.

Operating costs were six percent above the previous year due to manpower and premises-related expenses. Impairment losses reached P2.1 billion, or P547 million higher, with additional provisions set up for corporate accounts as well as possible credit losses that may arise from the recent typhoons, the bank pointed out 

Total resources went up by nine percent to P665 billion on a year-on-year basis. Deposits at P515 billion registered a four percent increase while assets held in trust posted a significant increase of 46 percent to P439 billion. Total customer funds managed by the bank thus amounted to P954 billion.

In the aftermath of the recent typhoons, BPI’s ‘bank anywhere’ initiative and 24/7 service allowed BPI customers to transact with any BPI or BPI Family branch or through self-service – BPI Express Online, BPI Express Phone and BPI Express Mobile anytime. These initiatives were implemented in 2008 as part of the bank’s major infrastructure change to enhance total customer experience.