Thrift banks’ combined profit up 17.85% in 2016

The 64 thrift banks reported cumulative net profits of R13.89 billion in 2016, up 17.85 percent from the previous year’s R11.78 billion, mostly from traditional income sources such as lending and deposits growth.

Based on Bangko Sentral ng Pilipinas (BSP) data, thrift banks’ net interest income rose by 9.29 percent year-on-year to R53.68 billion versus 2015’s R49.12 billion.

This income comes from traditional banking services such as lending and deposits.

Non-interest income, which is income from trading activities, also increased by 12.15 percent to R13.24 billion in 2016 compared to the previous year’s R11.81 billion.

The country’s top five largest thrift banks in terms of assets and loans are BPI Family Savings Bank, Philippine Savings Bank, RCBC Savings Bank, China Bank Savings (CBS) and City Savings Bank.

The top 10 list includes Philippine Business Bank, PNB Savings Bank, Sterling Bank of Asia, Bank of Makati and HSBC Savings Bank.

Bank lending to small and medium enterprises (SMEs) and micro SMEs have been rising over the past decade as lenders continue to display risk tolerance for small business borrowers. Savings banks primarily focus on the SME sector as a lending group.

Banks have hardly changed its lending standards for SMEs, based on a survey by the BSP. Thrift banks’ loans have been reporting double digit growth for years, it reported a 15 percent year-on-year growth at the end of 2015 at more than R680 billion.

The central bank considers thrift banks as an enabler of economic development by encouraging retail savings and extending credit to targeted sectors.