PNB income doubles in H1

Strong performance of its core businesses and higher non-recurring revenues doubled the earnings of Philippine National Bank (PNB) to P5.4 billion in the first half of the year from P2.7 billion in the same period last year.

The country’s largest lender in terms of assets, owned by tobacco and airline magnate Lucio Tan, booked a 50 percent jump in operating income as its net interest income went up 27 percent to P13.1 billion from P10.3 billion, driven by higher loan volumes and improving net interest margins.

PNB’s net service fees and commission income reached P1.68 billion, P61 million better than year-ago level, boosted by improvements in credit, deposit, and bancassurance fees offsetting lower underwriting and investment banking revenues owing to the lackluster activities in the capital markets.

Trading and foreign exchange gains de- clined to P795 million arising from muted trading opportunities brought about by the continuing upward movement of interest rates.

However, the bank booked a net gain of P4.4 billion from the disposal of foreclosed properties as a result of its continuing strategy of reducing non-earning assets.

Excluding these non-recurring gains on the sale of foreclosed assets, the growth in total operating income remains high at 19 percent year-on-year.

PNB said operating expenses, excluding provisions for impairment and credit losses, grew 18 percent as strong revenue growth translated to higher business taxes and other business-related expenses.

Without taxes and licenses, operating expenses increased by only 12 percent.

Provisions for impairment and credit losses amounted to P1.2 billion for the first half in line with its prudent provisioning policy to maintain the quality of its loan portfolio and in compliance with new accounting standards.