Banks net profit up 3.11%

Big banks’ cumulative net profits went up by 3.11 percent year-on-year in the first three months of 2020 to ₱51.08 billion from ₱49.54 billion, based on Bangko Sentral ng Pilipinas (BSP) data. Thrift banks, in the meantime, posted a 2.15 percent net loss during the period to ₱3.49 billion from ₱3.57 billion. Overall, the banking system had total net profits of ₱59.66 billion, up 9.29 percent from same time in 2019 of ₱54.58 billion. Big banks’ net interest income rose by 11.84 percent in the first quarter to ₱133.83 billion while its non-interest income also rose by 6.22 percent to ₱41.09 billion. Thrift banks’ net-interest income was up by 7.73 percent to ₱16.47 billion while its non-interest income dropped to ₱2.60 billion or down by 17.39 percent year-on-year. A recent BSP report said the financial soundness indicators of banks – after assessing the banking system’s strengths and weaknesses, “affirmed that the banking system is stable and resilient to withstand the effects and uncertainties of the global pandemic.” The BSP said that credit quality is “satisfactory amid upbeat loan growth on sound credit underwriting standards and provisioning culture. Bank capitalization, mainly comprised of common equity and retained earnings, remained well-above domestic and global benchmarks. Similarly, their strong liquidity position enables the banks to withstand short-term liquidity shocks while providing adequate stable funding for the medium term.” (Lee C. Chipongian)