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The Philippine National Bank (PNB) posted
double-digit growth in net income this year driven by corporate and
retail banking business.
In a statement, PNB said its net
income grew 48 percent to P457 million in the first quarter of the
year from P308 million in the same period last year.
The bank has sustained growth in
foreign exchange gains, deposits, retail banking and low operating
and interest expense.
PNB’s foreign exchange gains
grew 136 percent year on year to P571 million from P242 million
despite volatile operating environment.
Total deposits stood at P180
billion in the first quarter at the same time that interest expense
was reduced by 27 percent as the bank focused on generating low-cost
funds from deposits and other funding sources.
Operating expenses, however, went
down by 23 percent despite investments made in systems enhancement
and upgrade of facilities.
The bank recently implemented a
new core banking system called Flexcube that automates both
corporate and retail banking businesses and effectively insources
core overseas operations to its global data center in the
Philippines.
PNB’s Japan, Singapore, Hong
Kong and US branches as well as the London subsidiary have already
been converted and the rest of the bank is expected to go “live”
soon.
“With the significant
strengthening of its balance sheet over the past few years, PNB has
been able to concentrate on generating new client relationships in
the corporate segment, both in the large and SME categories.”
Meanwhile, consumer finance
business has continued to register growth.
Total consumer loans portfolio
rose by 25 percent to P3.3 billion in the first quarter from end of
last year.
Combined new bookings had reached
the half-billion peso mark. PNB’s net loans and receivables closed
P77 billion.
In terms total asset size, PNB
posted P242 billion in the first quarter, P2.7 billion higher than
in end-2007.
PNB’s capital adequacy ratio
under Basel II has remained high at 18.51 percent, still way above
the 10-percent ratio required by the Bangko Sentral ng Pilipinas.
PNB also plans to raise a minimum
of P3 billion of Tier 2 Capital in preparation for its maturing
subordinated notes in February 2009.
PNB will emerge as the fourth
largest domestic bank in the country in terms of asset size once its
planned merger with Allied Banking Corporation is completed in the
next two years.
--Maricel E. Burgonio
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