PSBank nets lower net income in 2020 due to loan loss buffering

Philippine Savings Bank (PSBank) took a hit in 2020 as it booked lower year-on-year net earnings as it hiked buffers for potential loan losses amid the COVID-19 pandemic.

In a disclosure to the Philippine Stock Exchange on Friday, PSBank said it ended 2020 with a net income of P1.108 billion, 63% lower than the P3.03-billon profits in 2019.

The lower bottomline came after the bank set aside additional loan loss provisions of P6.40 billion in view of the ongoing pandemic conditions.

Excluding provisions, PSBank’s operating income surged by 31% to P7.45 billion in 2020.

“On the back of a strong balance sheet and capitalization, the Bank stayed resilient amidst the challenges of 2020. As a matter of strategy, we took a conservative stance on credit provisioning in anticipation of risks associated with the pandemic,” PSBank president Jose Vicente Alde said.

“The bank prioritized the safety of its employees and customers by quickly instituting COVID-19 safety protocols. We strengthened our digital platforms and made them reliable as the demand for digital banking services exponentially rose,”Alde said.

Gross revenues grew by 13% higher to P16.57 billion.

Net interest income increased by 21% to P13.75 billion, owing to a significant growth in low cost current account/saving account (CASA) deposits and the decline in interest of term deposits.

CASA deposits grew 16% to P67.25 billion from P58.18 billion.

In 2020, the bank said digital enrolments and utilization increased 56% and 143%, respectively.

PSBank waived fees for interbank transfers through InstaPay and PESONet to further promote digital payments.

“As the economy slowly opens up in 2021, we shall remain positive and hopeful that our recalibrated business models will deliver and continue to adapt to the new environment. We will continue to pursue our digital transformation roadmap by delivering on what is relevant and simple for the customer,” Alde said.—AOL, GMA News