LISTED savings bank Philippine Business Bank (PBB) recorded a net income of P471.8 million in the nine months to September, down 2 percent from a year ago due to expansion costs and a slight drop in interest margins.
Rolando Avante, PBB president and chief executive officer, said that expansion costs offset the four-fold increase in trading gains.
“The lower net income [was]because of cost expansion and a slight drop in interest margins,” Avante said in a text message.
In its quarterly report released on Tuesday, the bank said its net interest income improved by 8.7 percent to P1.79 billion in the first nine months of 2015 from P1.65 billion in the same period last year.
Non-interest income from service charges, fees and commissions expanded 14.5 percent, while miscellaneous income dropped 53.5 percent from P146.8 million.
Through the nine months, its core income decreased by 10.3 percent from P704.9 million to P632.4 million this year.
Pro-forma recurring net income rose 14.1 percent to 513.4 million from P449.7 million in the same period last year, while pro-forma recurring core income reached P691.5 million this year, essentially flat against last year’s P690.1 million.
“The bank’s continuing profitability as evidenced by our strong recurring core income and PTPP (pre-tax and pre-provisioning profit) growth underscores my commitment to our shareholders. Since I joined PBB late in 2011, my to-do list of first, listing the Bank, and second, expanding our nationwide presence has been completed or is in the process of completion. The next step will be to upgrade our capabilities to a unibanking license,” Avante said.
In July, the PBB board of directors approved the acquisition of and merger with rural bank Insular Savers Bank for P518.2 million, which would add eight branches to PBB’s network. This was all paid in cash.
PBB has already achieved its target 140 branches to date — eight from Insular Savers, three from Bataan Savers Bank and two from Rural Bank of Kawit.
Avante has long been vocal about expanding PBB through acquisitions in the next few years.
Incorporated in 1997, PBB is a thrift bank owned by former ambassador Alfredo Yao and mostly caters to small and medium enterprises (SMEs).
Its branches are located in areas with high SME concentration such as Caloocan, Malabon, Navotas, Valenzuela, and Quezon City as well as in highly urbanized cities outside Metro Manila such as Cebu, Davao, and Bacolod.