The Philippine banking industry recorded a higher net profit in the first nine months of 2021 despite lower income streams as losses on financial assets also declined.

The cumulative net income of the banking system increased by 35% to P168.213 billion as of September from P124.554 billion in the same period in 2020, based on preliminary data released by the Bangko Sentral ng Pilipinas (BSP) on Thursday.

Net interest income stood at P485.005 billion in the January to September period, down by 4% year on year from P505.29 billion. This, as interest earnings dropped by 11% to P572.38 billion, while expenses declined by 40% to P86.871 billion.

Meanwhile, non-interest income declined by 5% to P164.576 billion as of September from P173.368 billion in the same period in 2020.

Dividend and trading income in the period were lower from a year ago by 29% and 22% to P1.838 billion and P75.475 billion, while earnings from fees and commissions increased by 18% to P76.125 billion.

Lenders’ non-interest expenses rose by 1.85% year on year to P373.417 billion from P366.603 billion.

The industry’s losses on financial assets dropped by 48% to P83.55 billion as of end-September from P161.379 billion a year earlier.

Provisions for credit losses declined by 44% to P90.344 billion from P161.123 billion, while bad debts written off surged by 126% to P6.364 billion from P2.814 billion.

Banks’ total loan portfolio rose by 2.63% to P10.959 trillion as of end-September from P10.678 trillion a year earlier.

Meanwhile, deposit liabilities stood at P15.643 trillion as of end-September, rising by 8.8% year on year from P14.377 trillion.

The local banking industry’s assets rose by 7.2% to P20.079 trillion as of end-September from P18.724 trillion a year earlier. — L.W.T. Noble

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