BSP income surges in 1st quarter

The central bank reported a significant net income increase of R9.82 billion in the first quarter from only R1.66 billion same time in 2017.

The increase of 492 percent yearon-year was due to a higher interest income and realized gains amounting to R7 billion during the period from foreign exchange (FX) transactions. However compared to the fourth quarter 2017 net income of R12.87 billion, the latest unaudited number is lower.

The Bangko Sentral ng Pilipinas’ (BSP) FX gains from FX rate fluctuations this year was higher compared to the R4.69 billion of the first quarter 2017 and R2.69 billion in the fourth quarter of last year.

The BSP reported revenues of R14.9 billion as of end-March and this was up 18.8 percent year-on-year from R12.6 billion.

According to the BSP, “increased revenue was brought mainly by the rise in interest income on international reserves and domestic securities by approximately R3.4 billion and R400 million, respectively.”

Total expenditures, in the meantime, decreased by R3.4 billion to R12.1 billion and this was because of lower interest expenses and taxes and licenses, said the BSP.

During the period, the BSP has total assets – mostly composed of international reserves – of R4.78 trillion, 3.7 percent more than same time last year of R4.61 trillion.

Total liabilities were up three percent to R4.69 trillion as of end-March from R4.55 trillion. These are mostly deposits and currency issues and supported by higher placements in the term deposit facility, the central bank said.

The BSP’s net worth stood at R91.4 billion which was 49.6 percent higher year-on-year.

By law, the BSP has to share its gains – not losses – with the National Government, and it has to remit 75 percent of its net income to the NG, a higher amount compared to other government-owned and controlled corporations which remit only 50 percent.

Last year, the BSP reported a net income of R22.85 billion which was more than 2016’s R17.81 billion.

Before 2016, the BSP has been reporting annual losses from 2010 until 2015 due to FX losses. It had huge FX losses in 2010 until 2012 although there were some small recoveries in 2013 and 2014.