PNB net profit surges on loans, one-off gain

Business World - - Banking&finance - By Melissa Luz T. Lopez Se­nior Re­porter

PHILIP­PINE Na­tional Bank (PNB) saw its net in­come surge as of Septem­ber, driven by one-off gains from as­set sales as well as a big­ger loan book.

The Tan-led lender re­ported a con­sol­i­dated net in­come of P7.5 bil­lion for Jan­uary-Septem­ber, spell­ing a 67% in­crease from the com­pa­ra­ble year-ago pe­riod. PNB said this was driven by a 36% jump in to­tal op­er­at­ing in­come, ac­cord­ing to its reg­u­la­tory fil­ing to the Philip­pine Stock Ex­change yes­ter­day.

Net in­ter­est prof­its amounted to P20 bil­lion, a fifth higher than the P16.2 bil­lion it made dur­ing the same nine-month pe­riod in 2017. The bank’s loan port­fo­lio reached P550.7 bil­lion as of Septem­ber, while de­posits like­wise in­creased to hit the P692.8 bil­lion level.

Col­lec­tions from ser­vice fees and non-in­ter­est in­come sources also posted a mar­ginal in­crease to P2.5 bil­lion, driven by higher rev­enues from credit, de­posit and ban­cas­sur­ance prod­ucts. These helped off­set lower gains drawn from un­der­writ­ing and in­vest­ment bank­ing at a time of tepid ac­tiv­ity in the lo­cal cap­i­tal mar­kets, PNB said.

Mean­while, gains from trad­ing and for­eign ex­change dropped to P1.42 bil­lion, as mar­ket play­ers were re­luc­tant to bet at a time of eas­ing in­ter­est rates.

Pro­vid­ing a boost to the bank’s bot­tom line are one-off gains worth P4.6 bil­lion from the sale of fore­closed prop­er­ties. These are as­sets seized from non-pay­ing bor­row­ers which are even­tu­ally sold off by a bank in or­der to re­coup loan losses.

On the other hand, PNB also in­curred big­ger costs as op­er­at­ing ex­penses grew by 16% year-on-year, largely due to higher busi­ness taxes.

To­tal bank as­sets reached P910.7 bil­lion as of end-Septem­ber, while the listed lender con­tin­ued to be well-funded with a cap­i­tal ad­e­quacy ra­tio of 14.8%, bet­ter than the cen­tral bank’s 10% stan­dard.

PNB, the coun­try’s fifth­biggest bank, an­nounced in Septem­ber that it will ab­sorb its thrift unit PNB Sav­ings Bank, sub­ject to reg­u­la­tory ap­provals. Once com­bined, the lender will have a to­tal of 707 branches and over 1,390 au­to­mated teller ma­chines in the coun­try, on top of 70 over­seas of­fices.

PNB Pres­i­dent and chief ex­ec­u­tive of­fi­cer Rey­naldo A. Ma­clang will be re­tir­ing by Nov. 15. He will be re­placed by Jose Ar­nulfo “Wick” A. Veloso, who was the for­mer pres­i­dent and CEO of the Hong Kong and Shang­hai Bank­ing Corp. (HSBC) Philip­pines.

PNB shares dropped 0.13% to P39.25 apiece on Thurs­day.

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