BPI 9-month profit slips down to P48.9B

Bank of the Philippine Islands (BPI) saw its nine-month net income fall 3.2 percent to P48.9 billion as higher provisions and operating expenses outpaced revenue growth.

January to September earnings declined from P50.5 billion a year earlier, despite increases in lending and fee income.

Revenues rose 9.8 percent to P156.3 billion, but provisions climbed 69.2 percent to P19.9 billion.

Operating expenses increased 12.5 percent to P73.7 billion, driven by manpower, technology and business volume-related costs.

This brought the cost-to-income ratio to 47.1 percent.

Net interest income grew 11 percent to P121.1 billion, supported by a 10.7-percent expansion in average earning assets. Net interest margin stood at 4.6 percent.

Non-interest income increased 5.8 percent to P35.2 billion. Fee income rose 15.5 percent on higher contributions from credit cards, wealth management and insurance.

Provisioning

While nine-month provisions increased, third-quarter provisioning eased 16.5 percent from the preceding quarter.

The nonperforming loan (NPL) ratio rose quarter-on-quarter to 2.5 percent. NPL coverage stood at 89.6 percent.

Total loans expanded 13.6 percent to P2.7 trillion as lending grew across customer segments.

Institutional loans increased 11.3 percent, while non-institutional loans rose 18.9 percent.

Lending to small and medium enterprises jumped 46.7 percent, followed by credit cards at 27.2 percent and personal loans at 21.7 percent.

Deposits grew 11 percent to P3 trillion, bringing the loan-to-deposit ratio to 92.4 percent. Total assets increased 10.8 percent to P3.9 trillion.

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Equity rose 2.9 percent to P488.6 billion. The indicative Common Equity Tier 1 ratio was 13.9 percent, while the capital adequacy ratio stood at 14.7 percent, both above regulatory requirements.

Return on equity reached 13.6 percent and return on assets stood at 1.8 percent.

Separately, the merger of BPI Direct BanKo Inc., A Savings Bank and Legazpi Savings Bank Inc. took effect on Oct. 1, with BanKo as the surviving entity.

The consolidation aims to deepen BPI’s presence in microfinance and teachers’ loans.

BPI also integrated National ID eVerify into its app for account opening and secured dual ISO certifications covering information security and privacy management.

S&P Global Ratings affirmed the bank’s BBB+ credit rating with a stable outlook in September, matching the Philippine sovereign rating.