Bankcom exceeds 2022 profits
Bank of Commerce (BankCom), an affiliate of San Miguel Corporation (SMC), posted a record net income of ₱2 billion for the first nine months of 2023, outperforming the fullyear 2022 profit of ₱1.8 billion by 12 percent.
In a disclosure to the Philippine Stock Exchange (PSE), the bank said it is also 35 percent higher than the ₱1.49 billion net income in the same nine-month period last year.
Sustained growth in the bank’s core revenue streams, higher interest margins and growth in fee-based income (investment banking, credit card, trust, and trade finance) were the main drivers of the solid performance.
For the first nine months of 2023, total revenues surged 25 percent to ₱7.30 billion from the ₱5.82 billion posted last year, mainly attributable to the notable growth in net interest income and service charges, fees, and commissions
Net interest income, which accounts for 83 percent of the total revenues, increased to ₱6.08 billion, 1.3 times the ₱4.82 billion in the previous year.
This is mostly driven by sustained growth in the bank’s earning assets, particularly corporate loans. Also, despite the rising interest rate environment, the bank effectively managed funding cost, resulting in a higher net income margin of 4.24 percent.
Other income rose to ₱1.22 billion, up 21 percent from P1 billion in 2022, owing to steady flow of the bank’s fee-based income.
Service charges, fees and commissions rose to ₱640.25 million largely driven by Investment Banking, Credit Card, Trust, and Trade Finance fees.
The bank raked in a total of ₱89.88 million in underwriting commissions for the period, representing 14 percent of the total service charges, fees and commissions.
Meanwhile, foreign exchange (FX) gains which amounted to ₱115.01 million, inched up by 0.6 percent from ₱114.31 million.
The bank maintains a conservative stance by setting aside ₱222.43 million as provision for credit and impairment losses. Non-performing loan coverage ratio was at 97.88 percent.
Operating expenses, excluding provision for credit and impairment losses, totaled ₱4.33 billion, 10 percent up from the ₱3.94 billion in the comparable period last year on the back of increases in compensation and benefits, service fees and commission, subscription and management and professional fees.
Bankcom’s total assets grew by three percent to ₱224.31 billion from ₱217.52 billion as of the end of 2022, translating to a return on assets of 1.21 percent.