SY-LED Banco De Oro Unibank Inc. (BDO) said its net income in the nine months through September rose 19 percent to P7.6 billion.

In a Philippine Stock Exchange filing on Thursday, the country’s biggest lender in terms of assets added that gross customer loans during the period rose 24 percent to P620.8 billion, outpacing the industry’s 19 percent growth.

Total deposits increased 15 percent to P820.6 billion, buoyed by low-cost deposits generated from an expanded branch network. System liquidity, however, continued to compress asset yields, and net interest income improved slightly to P25.7 billion.

“The bank managed to post a record performance despite the difficult operating environment here and overseas. BDO will continue to maintain cautious stance due to the current economic developments in Europe and in the US,” the lender said in a statement.

BDO shares declined 0.81 percent to P54.8 each on Thursday, giving it a market value of P142.89 billion.

The bank said recurring fee-based income from service businesses rose 17 percent to P8.8 billion, driven by strong growth from asset and wealth management, payments and electronic banking, insurance and capital markets.

Moreover, it booked a 16-percent increase in foreign-exchange gains to P5.1 billion despite the volatile external market conditions.

“Overall, non-interest income including other miscellaneous income went up by 16 percent to P15.3 billion,” BDO said.

Operating expenses grew at 5 percent to P27 billion while pre-provision operating profit rose 10 percent year-on-year.

Despite the growth in the bank’s balance sheet, asset quality improved with the so-called gross non-performing loan (NPL) ratio dipping to 3.9 percent from 4.7 percent as of year-end.

The BDO also maintained its provisioning by setting aside P5.1 billion year-to-date, bringing its NPL coverage ratio now to 108 percent.

The BDO’s capital position was stronger with so-called Capital Adequacy Ratio (CAR) rising to 15 percent following a P8.5 billion Tier 2 issue in June. It issued an additional P6.5 billion worth of Tier 2 Notes in October 2011 to further supplement the bank’s capital position and complete its P15- billion capital program.

The BDO is a unit of SM Investments Corp., a listed holding company involved in retail merchandising, banking, mall development, and residential and leisure real-estate development.