Bank of Commerce earns record P1.8 B in 2022

The banking arm of conglomerate San Miguel Corp. (SMC) jumped by 49 percent to hit an all-time high of P1.8 billion last year from P1.2 billion in 2021 on the back of robust core businesses.

This capped 2022 as a banner year for Bank of Commerce as its license was upgraded by the Bangko Sentral ng Pilipinas (BSP) to universal bank status from a commercial bank and it raised P3.37 billion through its listing at the Philippine Stock Exchange (PSE).

Bank of Commerce also raised P7.5 billion via its maiden bond issuance at the Philippine Dealing and Exchange Corp. (PDEx).

The listed bank’s gross revenues jumped by 30 percent to P8.12 billion last year from P6.22 billion in 2021 due to the growth in net interest income, service charges, fees, and commissions, foreign exchange and gains on foreclosure and sale of property and equipment and foreclosed assets.

Net Interest Income grew by 24 percent to P6.68 billion from P5.4 billion boosted by the increase in interest on loans and receivables and investment securities.

Other income also supported the bank’s profit as it soared by 74 percent to P1.43 billion from P826.34 million.

This was primarily due to the 61 percent jump in service charges, fees and commissions to P857.63 million. The significant increase was mainly brought about by its new revenue stream from investment banking, foreign exchange gains that more than tripled to P150.32 million, gains on foreclosure, and sale of property and equipment and foreclosed assets amounting to P340.45 million as well as strong growth in trade and digital transactions.

For the fourth quarter alone, the bank’s net income amounted to P311.58 million as gross revenues jumped by 46 percent to P2.29 billion from P1.57 billion in the same quarter last year.

The loan portfolio of Bank of Commerce jumped by 41 percent to P105.1 billion from P74.37 billion, driven mainly by accelerated growth in corporate loans. The growth resulted to a loan-to-deposit ratio to 70.3 percent.

The bank’s asset quality also improved as net nonperforming loan (NPL) ratio eased to 0.60 percent last year from 0.88 percent in 2021.

Its capital base grew by 20 percent to P28.03 billion from P23.36 billion, spurred by the proceeds from the initial public offering (IPO) in the first quarter of 2022.

This translated into a return on equity of 7.01 percent, while its common equity tier 1 ratio stood at 17.22 percent and its capital adequacy ratio at 17.97 percent, well above regulatory standards.

The bank’s total assets inched up by nine percent to P217.52 billion from P199.71 billion mainly from the growth in loans and additional investment securities. Its return on assets stood at 0.86 percent.