CHINA Banking Corp. (China Bank) said earnings rose in the first quarter driven by the robust expansion of its core businesses.
In a disclosure to the bourse Friday, the bank, controlled by the Sy family, booked a net profit of P1.9 billion in the first three months, up 24% from a year earlier.
This translated to a return on equity of 8.42% and return on assets of 0.86%.
China Bank’s net interest income grew 12% in the three months to March, to P5.9 billion, propelled by a 41% jump in interest revenue from loans.
Gross loans amounted to P515 billion at the end of March, up 13% from a year earlier, driven by strong demand from all customer segments.
The non-performing loan (NPL) ratio declined to 1.2%, while the NPL coverage ratio stood at 169%.
On the other hand, deposits rose 17% to P720 billion, up 17%, underpinned by a 20% increase in checking and savings accounts.
Non-interest income rose 52% year-on-year to P1.3 billion in the first quarter, after a 34% rise in fees, service charges and commissions, income from acquired asset sales, as well as gains from trading.
Higher interest expenses compressed the net interest margin to 2.94%.
Operating income was P7.2 billion, up 18%, while operating expenses grew 13% to P4.8 billion, as the lender continued to strengthen and expand its operations.
The cost-to-income ratio fell to 66% from 69% a year earlier.
Overall, total assets increased 23% year-on-year to P889 billion, with capital at P89 billion at the end of March.
The tier-1 capital adequacy ratio (CAR) was 12.9%, while total CAR was at 13.8%.
“We are gratified that our first quarter results reflect the sustained growth in our businesses and the result of various initiatives,” China Bank President William C. Whang was quoted as saying in the statement.
Last month, the country’s sixth-largest bank in asset terms announced it will raise up to P75 billion worth of peso-denominated retail bonds or commercial papers to support China Bank’s initiatives and expansion.
On Friday, China Bank rose 3.19% to P27.50. — Karl Angelo N. Vidal