Net interest income, which accounts for 83 percent of total operating income, rose by 10 percent to P36.5 billion, driven by a 15-percent growth in customer loans and investments.
Despite higher interest expenses on deposits, the bank managed to deploy funds effectively into higher-yielding assets. Other operating income reached P4.1 billion, though lower than last year’s due to the absence of one-time gains from foreclosed assets.
Excluding these gains, other operating income grew by 31 percent, thanks to strategic trading. Operating expenses increased slightly by one percent, reaching P21.7 billion.
Better asset quality, growth
Credit provisions were set at P3.7 billion, lower than the previous year as asset quality improved. Total consolidated assets rose by 2 percent to P1.20 trillion, while equity increased by 13 percent to P210.1 billion.
The bank’s capital adequacy ratio stood strong at 17.8 percent, with a Common Equity Tier 1 Ratio of 16.9 percent.
Management’s view
“The bank’s core revenues steadily increased as we continue to enhance our policies and processes to sustain the growth momentum of the bank’s core banking activities amidst continued economic expansion,” Francis Albalate, chief financial officer of PNB, said in a statement.
US dollar bond sale
Recently, PNB raised $300 million through a five-year sustainability bond under its $2 billion Euro Medium Term Note program.
The bond, rated Baa3 by Moody’s, was oversubscribed by 3.6 times, attracting $1.1 billion in demand.
“The result of this note offering is a clear indication of investors’ trust and confidence in PNB,” said Florido Casuela, president of PNB.
“This offering will fund the Bank’s sustainable financing initiatives as we continue to solidify our position among the forerunners of nationwide development across the Philippine banking system,” he added.