CHINA BANKING Corp. posted a 29% jump in its net earnings in the third quarter as it managed costs and as its core business continued to grow.
The bank’s net income went up to P3.9 billion from P3 billion in the same period a year earlier, it said in an e-mail on Thursday.
For the first nine months, its net income went up 35% to P11.2 billion, which translated to a return on equity of 13.6%, up from 11.1% last year, and a return on assets of 1.5%, also higher than 2020’s 1.1%.
“These results exceeded our expectations,” China Bank President William C. Whang said in a disclosure to the local bourse.
“We will continue to support our customers, especially those who are still struggling amid the global pandemic, as we push for greater efficiencies and sustainable growth through digitalization and optimization of our branch and ATM networks.”
In the third quarter, the bank’s net interest income went up 12% to P9.7 billion from P8.7 billion a year earlier.
Meanwhile, its income from fees declined 7% to P2.1 billion from P2.3 billion a year ago.
China Bank’s net revenues in the third quarter grew by 8% to P11.8 billion from P10.9 billion.
On the other hand, operating expenses declined by 7% to P5.5 billion from P5.9 billion last year.
The bank set aside P1.1 billion in provisions for impairment losses in the third quarter, down 27% from P1.6 billion.
China Bank in its disclosure said gross loans expanded by 3% to P612 billion in the nine months to September as business activities gradually returned.
Its gross nonperforming loan ratio as of end September was 3.4%, lower than the 3.5% in June and the industry average for the period.
On the funding side, total deposits with the bank rose 3% to P849 billion as of September after a 23% increase in current account, savings account (CASA) deposits to P529 billion.
Time deposits declined by 19% to P321 billion.
“China Bank’s sustainable funding sources and strong capital continue to be key strengths. About 62% of the bank’s P849-billion total deposits were accounted for by CASA, up from 52% last year, and this helped bring down our overall funding cost. Our healthy capital ratios also reflect the bank’s financial soundness,” China Bank Chief Finance Officer Patrick. D. Cheng said in the statement.
China Bank’s assets inched up 4% to P1.05 trillion at end-September from P1.01 trillion a year earlier.
Total capital funds grew by 13% to P114 billion. Its common equity Tier 1 ratio of 14.4% at end-September was higher than the 13.1% last year, while the total capital adequacy ratio of 15.3% also increased from 14%.
Shares in China Bank went up 1.24% or 30 centavos to close at P24.45 each on Thursday. — Jenina P. Ibañez