BDO posted P26.1-billion income in 2016

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BDO Unibank Inc. (BDO) reported full-year 2016 results net income totaling P6.1 billion, matching the bank’s earnings guidance for the year and setting a record net income for the lender.

BDO President Nestor V. Tan attributed the bank’s performance on strong results across its core businesses, as well as efforts at building recurring and diversified income streams. These were supplemented by continued branch expansion in key provincial areas and initiatives to tap new markets and underserved sectors. In 2016 BDO launched its online stock-trading services (BDO Nomura Securities), strengthened its life-insurance business (BDO Life), and expanded its rural-banking platform (One Network Bank or ONB).

For the first quarter of 2017, the bank delivered net income of P5.8 billion, up 6 percent year-on-year. Net interest income remained the major earnings driver, rising by 19 percent to P18.4 billion. Customer loans accelerated by 21 percent to P1.5 trillion with all market segments turning in robust expansion rates. Meanwhile, total deposits grew by 13 percent to P1.9 trillion backed by the 17-percent jump in low-cost Casa deposits.

Other income, likewise, contributed significantly to the bottom line, led by fee-based service income from payments and settlements, credit card acquiring fees and wealth-management services, which increased by 42 percent to P6.8 billion and insurance premiums further adding P2.2 billion. Meanwhile, trading and foreign-exchange gains dropped by 4 percent to P1.4 billion.

The bank continued to set aside provisions amounting to P1.4 billion for the quarter even as asset quality remained healthy with nonperforming loan (NPL) ratio unchanged at 1.3 percent and NPL cover at 138 percent.

Meanwhile, the successful completion in January of the bank’s rights offer, which generated a total of P60 billion ($1.2 billion) in fresh capital bolstered the bank’s capital base to P282 billion, as well as enhanced its capital adequacy ratio and common equity tier 1 to 15.6 percent and 14 percent, respectively.

With a strengthened capital base, robust business franchise and extensive distribution network, BDO is well positioned to benefit from the country’s growth momentum.

The bank earlier this year declared and paid P0.30 per share cash dividend on common shares for the first quarter of 2017. The bank, likewise, disclosed its earnings guidance of P28.0 billion for the full-year 2017.