BDO Unibank Inc. said on Wednesday its net income in the first nine months of this year increased 10 percent to P19.3 billion, driven by its lending, deposit and fee-based businesses despite lower trading incomes.
The Henry Sy-led bank also recorded a 16-percent jump in net interest income from loans and deposits to P48.4 billion.
BDO said its loan books expanded by 15 percent to P1.4 trillion on broad-based growth across all market segments.
Total deposits rose 14 percent to P1.8 trillion, driven by a 21 percent increase in low-cost deposits, or current accounts and savings account (CASA), which now comprise 70 percent of total deposits.
It said fee-based income rose 15 percent to P16 billion despite a 29 percent decline in trading and foreign exchange income declined to P4.5 billion.
Operating expenses increased by 29 percent to P52.8 billion, which reflects the consolidation of its One Network Bank (ONB) and BDO Life Insurance operations. Net of these new businesses, operating expenses would have grown by only 12 percent in line with the bank’s continued business expansion, BDO said.
The bank set aside P2.6 billion in provisions even as asset quality held firm. Gross non-performing loan (NPL) ratio was steady at 1.3 percent, while NPL coverage remained high at 143 percent.
The bank’s capital base stood at P215.4 billion. BDO said common equity tier 1 (CET1) and capital adequacy ratio (CAR) both remained above the current regulatory minimum under the Basel III framework.
Last month, BDO issued $300 million worth of fixed-rate senior notes with a 2.63 percent annual yield rate, the lowest ever coupon rate for any dollar-denominated bond for a Philippine issuer.
The bank had earlier announced a plan to raise P60 billion through a stock rights offer, the proceeds of which will be used to support its medium-term growth objectives amid the country’s favorable macroeconomic prospects.
It said the funds raised from the offer would also provide a comfortable buffer over higher capital requirements with the forthcoming imposition of the Domestic Systemically Important Bank (DSIB) surcharge.
BDO is the largest bank in the Philippines in terms of assets. It is led by Henry Sy, the country’s wealthiest man, and is part of the SM Group via holding firm SM Investments Corp.
BDO operates more than 1,000 branches and over 3,000 ATMs nationwide. It also has a branch in Hong Kong as well as 25 overseas remittance and representative offices in Asia, Europe, North America and the Middle East.