PHILIPPINE BUSINESS BANK’S NET INCOME UP 34.0% YOY TO P858.0 MILLION

Sustained profitability as core income grows: • Interest income increased by 41.9% Year-over-Year (YoY) to P5.5 billion as of year-end 2018

• Net interest income grew by 24.3% to P3.8 billion

• Core Income1 reached P1.6 billion, a 51.4% increase YoY

• Pre-tax pre-provision profit (PTPP2) ended at P1.5 billion for the full year ending 2018 from P1.2 billion in 2017, up 30.9% YoY

• Profit before tax expanded to P1.2 billion, up 35.9% YoY • Net income grew to P858.0 million, a 34.0% growth

Balance sheet expansion continues:

• Total resources stood at P94.7 billion, up 8.6% versus YE17

• Loans and other receivables at P75.5 billion as of December 2018 up 7.1% YoY

• Total deposits increased by 5.1% to P77.3 billion

• Total equity grew by P1.1 billion to P11.4 billion, a 11.1% increase YoY

Caloocan City, Philippines – Philippine Business Bank (PSE: PBB) reported a net income of P858.0 million for year-end 2018, up 34.0% versus P640.1 million in the same period last year. Interest income expanded to P5.5 billion from P3.9 billion in 2017, up 41.9%. Core income grew to P1.6 billion from P1.0 billion, a 51.4% increase YoY. Profit before tax also expanded by 35.9% to P1.2 billion versus P913.3 million in 2017.

“The Bank made solid progress throughout 2018, showing double digit growth rates in income Year-over-Year. PBB’s continued efforts to fortify its balance sheet, while managing its costs and expenses, were the key factors that allowed the Bank to generate profitability despite challenges brought about by inflation and rising funding costs. As a result, the Bank’s net income in 2018 reached P858.0 million. PBB continues to invest in its people and improve its infrastructure to further expand its capabilities in order to better serve its clients,” said Roland Avante, President and CEO of Philippine Business Bank.

Total loans and receivables ended at P75.5 billion as of December 2018. Total resources reached P94.7 billion in 2018. On the funding side, total deposits increased to P77.3 billion at the end of December 2018. Low-cost funds grew 10.3%, while time deposits reached P46.4 billion.

Shareholders’ equity was at P11.4 billion, equivalent to a book value per share of P16.68 net of preferred shares. Earnings per share ended at p1.33 per share in December 2018, higher than the P0.99 per share in the same period last year.

“A good anticipation of the changing market developments and factors enabled PBB to adjust the Bank’s balance sheet, and improve its process flow earning higher fee based income this year. Maintaining a good asset quality is always a focus and with the continued management of the Bank’s loan portfolio, PBB’s asset base grew to P94.7 billion,” explained Avante.

On December 2018, the Monetary Board in its Resolution No. 2141 approved the merger of Philippine Business Bank and Insular Savers Bank (“ISB”), with PBB as the surviving entity. This merger opens an opportunity for the Bank to further develop its brand in the consumer lending business. PBB will capitalize on ISB’s proprietary consumer lending products such as second hand car financing, group salary loan products, and utilize and integrate its business processes, systems, human capital, and infrastructure.

“The Bank believes that ISB’s second hand car loan and company group salary loan products are very promising. ISB has already established a foothold in these markets, especially in Metro Manila, which will help PBB expand its market base. These products will be distributed in select branches nationwide expanding the Bank’s consumer loan portfolio by at least 20% in the next 5 years. ISB will boost the Bank’s bottomline by 8% to 10%.” added Avante.

*Core income is total revenues extrading gains/(losses) less non-interest expenses

* Pre-tax pre-provision profit is net revenues less non-interest expenses