PHILIPPINE Business Bank, Inc. (PBB) saw its net income rise by 22.59% year on year in the second quarter.

The lender’s attributable net income stood at P380.43 million in the April-to-June period, higher than P310.33 million seen in the same period last year, based on its quarterly report submitted to the local bourse on Wednesday.

This brought its net profit in the first half to P869.24 million, up by 40.14% year on year from P620.28 million.

As a result, the lender’s return on average equity stood at 10.96%, while its return on average assets was at 1.28% at end-June.

“In the first half of 2023, PBB sustained solid top-line growth owing to better interest rate margins, healthy loan growth, and improved income on trading. The growth in the bank’s deposits and loans was satisfactory, given the current market uncertainties evident in today’s environment. PBB saw signs of tightening competition, especially in the lending business, but its customers have remained loyal to the Bank despite the aggressive stance of other banks,” PBB President and Chief Executive Officer Roland R. Avante said in a statement.

PBB’s net interest income in the second quarter grew by 30.1% to P1.56 billion from P1.2 billion, driven by higher interest earnings from loans and other receivables (70.33%), investment and trading securities (10.82%), and due from the Bangko Sentral ng Pilipinas (BSP) and other banks (61.7%).

“This is due to the increasing interest rate imposed by the BSP to manage the country’s inflation rate,” PBB said.

Meanwhile, interest expenses jumped by 310.62% to P654.17 million.

The bank’s net interest margin stood at 4.89%, up from 4.33% at end-2022.

Meanwhile, other income declined by 52.98% to P140.8 million.

On the other hand, other expenses went up by 13.08% to P1.01 billion from P895.64 million.

The lender’s cost-to-income ratio was at 42.13%, down from 47.84% at end-2022.

The bank set aside loan loss provisions amounting to P150 million in the second quarter, down by 16.67% from P175 million in the same period last year.

PBB’s net loans stood at P103.84 billion at end-June.

Its bank’s nonperforming loan (NPL) ratio stood at 6.92%, up from 5.37% as it recorded P7.4 billion in NPLs at end-June.

On the funding side, deposit liabilities stood at P112.30 billion.

The bank’s loan-to-deposit ratio stood at 92.46% in the second quarter.

Meanwhile, total equity was at P17.1 billion at end-June. Its capital adequacy ratio was at 13%.

PBB’s total assets stood at P137.18 billion at end-June.

Its shares went down by 27 centavos or 3.42% to end at P7.63 each on Wednesday. — A.M.C. Sy