BDO meets P22.8-B profit guidance on higher loans, deposits

Higher loans and deposits helped BDO Unibank Inc. (BDO) meet its profit guidance of P22.8 billion for 2014, a record high for the bank. 

 

Net income reached P22.828 billion last year, up a marginal 0.8 percent from 22.646 billion in 2013, a company filing with the Philippine Stock Exchange on Thursday showed.

 

BDO said its earnings were driven by the strength of its core businesses.

 

Except for the one-off trading gains booked in 2013, the net income last year represented an 18 percent growth in terms of recurring earnings. 

 

In April 2014, BDO said it is targeting a marginal rise in earnings this year, as net profit in the first quarter fell by nearly 50 percent in the absence of non-recurring trading gains.

 

The bank said its customer loan portfolio outpaced the industry, posting a 20 percent growth to P1.1 trillion from P900 million a year earlier.

 

Total deposits rose 11 percent to P1.5 trillion, yielding a 19 percent increase in net interest income to P51.2 billion from P43.2 billion. Meanwhile, fee-based service income contributed P18 billion, up 16 percent from P15.5 billion.

 

The growth in net interest income and fees more than compensated for the decline in trading and foreign exchange gains.

 

Operating expense grew by 12 percent to P48.53 billion from P43.26 billion on business and branch expansion.

 

Asset quality continued to improve as the gross non-performing loan (NPL) ratio fell further to 1.3 percent from 1.6 percent, with P1.5 billion set aside as loan-loss provision to raise the coverage to 188 percent. 

 

BDO’s capital base stood at P180 billion, registering a capital adequacy ratio of 14.6 percent and Tier 1 capital ratio of 12.4 percent. – VS, GMA News