The Land Bank of the Philippines posted a sharp 44 percent fall in net income for the first quarter of 2014 due to reduced profits from investments as interest rates increased from historically low levels in the first half of last year.
In a statement on Thursday, the state-owned bank reported that its first-quarter net income slid to P2.9 billion from last year’s income of P5.1 billion.
“Notwithstanding these low Q1 results, we are encouraged, as income from loans remains strong. We are well positioned for sustained growth this year as we continue to expand our deposits and increase revenue from traditional and non-traditional sources,” LandBank President and Chief Executive Officer Gilda Pico said.
The bank’s return on equity stood at 11.9 percent, while its Basel III capital adequacy ratio was at 13.68 percent. LandBank’s deposits grew by a hefty 28 percent to P733.8 billion, based on figures at end-March, from P574.7 billion in the same period last year.
Loans expanded 13.4 percent to P310.9 billion from P274.1 billion. Total assets increased by 18 percent to P873.7 billion from P737.4 billion in March 2013, while capital stood at P67.6 billion.
Alongside fortifying its universal banking operations, LandBank said it remains the biggest lender to the agricultural sector.
The bank’s priority sectors comprise small farmers and fishermen, micro-enterprises and small and medium enterprises, agri-aqua related projects of local governments and government-owned and –controlled corporations, socialized to medium-cost housing, and utilities. The bank also reported that it has a presence in 80 provinces of the country with a nationwide network of 344 branches and 1,256 automated teller machines. It also plays a significant role in major government programs such as the Conditional Cash Transfer, the Food Supply Chain Program, and the Overseas Filipino Workers Reintegration Program.
LandBank is also one of the four local banks upgraded to investment grade rating by Moody’s in 2013.