BPI earnings up 3% to P23 billion in 2018

MANILA, Philippines — Ayala-led Bank of the Philippine Islands (BPI) booked a three percent rise in net income to P23.08 billion last year from P22.42 billion a year ago due to higher interest earnings after a tightening cycle by the Bangko Sentral ng Pilipinas (BSP).

BPI president and chief executive officer Cezar Consing said prospects are brighter this year after the bank beefed up its capital base last year.

 “The capital that we raised in 2018 allowed us to invest in our ongoing digitalization program, and in our high yielding SME, consumer and microfinance businesses. The returns from these investments will become apparent in the coming years. We’re quite excited by what 2019 offers,” Consing said.

BPI tapped the equity and debt capital markets last year with landmark issuances, starting with the P50 billion stock rights offering in May, the issuance of $600 million in senior unsecured bonds in August, and the issuance of P25 billion in peso fixed rate bonds in December.

It said the overwhelming success of the series of fund raising transactions is testament to the strength of the BPI franchise.

The bank’s gross revenues booked a double-digit increase of 10.6 percent to P78.52 billion last year from P71.02 billion in 2017, driven by 16.2 percent jump in net interest income to P55.84 billion.

BPI traced the increase in net interest income to the nine percent increase in average asset base, and a 21-basis point expansion in net interest margin).

Yield on interest earning assets improved by 49 basis points, partially offset by a 34-basis point increase in cost of funds, owing to higher documentary stamp taxes, higher time deposit rates, and an increase in other borrowings.

BPI’s loan book grew by 12.7 percent to P1.35 trillion amid the 13.3 percent growth in corporate loans and 23.8 percent jump in credit card loans, while its deposit base inched up 1.5 percent to reach P1.59 trillion.