CHINA BANKING Corp. (China Bank) saw its net income grow in the third quarter as its core and fee-based businesses expanded.

In a disclosure on Thursday, Sy-led China Bank said its consolidated net income in the third quarter stood at P2.09 billion, up by 32% from the P1.58 billion recorded in the same period a year ago.

The growth in its third-quarter net income drove its earnings for the first nine months of the year to rise to P5.68 billion, 17% higher than P4.48 billion booked in the comparable year-ago period.

China Bank said its net interest income — which includes profits from loans, and trading and investment securities, among others — grew 16% to P14.26 billion.

Its gross loans portfolio “grew faster than the industry” to P434.81 billion, up by 25%. Consumer loans expanded by 28%, while corporate loans jumped 32%, driven by a robust pipeline and reflecting strong corporate demand.

Total deposits in the bank also rose 22% to P578.04 billion, backed by 25% growth in low-cost current and savings account (CASA) deposits. CASA ratio improved to 52.94%, while loans-to-deposit ratio stood at 74.31%. China Bank said this is a “reflection of the bank’s franchise strength boosted by deposit growth from new branches.”

Meanwhile, China Bank’s non-interest income also grew by 17% to P4.90 billion even as it saw a P611.43-million drop in its trading gains.

The bank’s core operating income, excluding trading gains and non-recurring income, grew by 19% from last year, driven by a “robust growth in recurring income” from service charges, fees from investment banking and trust, as well as income from asset sales.

China Bank’s non-performing loan (NPL) ratio stood at 1.76%, as NPLs dropped by P700 million against last year. The lender’s consolidated NPL coverage ratio also improved to 91.29% from last year’s 86.57%, with the parent bank’s ratio at 141.62%.

The bank’s total assets, meanwhile, expanded by 23% to P692.74 billion.

Total capital stood at P82.38 billion, up by 29%. China Bank’s capital adequacy ratio was at 13.85%, while common equity Tier 1 ratio was at 14.65%, well above the regulatory minimum.

Consolidated return on equity was at 10.41% and return on assets was 1.16% as of September.

“China Bank continues to deliver positive results on the back of strong growth in our core banking businesses,” newly-minted China Bank President William C. Whang said. Mr. Whang assumed the position last Nov. 1.

“The better-than-expected results reflect the fruits of our significant strategic initiatives since we began our expansion phase 10 years ago with the Manila Bank acquisition,” Mr. Whang noted.

The official said China Bank had 569 branches as of September, with 158 branches of China Bank Savings, its thrift banking arm.

“The savings bank subsidiary has turned around to full profitability in 2016 and is in a better position to significantly contribute to the growth in customer base and revenues,” Mr. Whang said.

“On the other hand, China Bank Capital [Corp.] continued to be a major player in the capital markets, with China Bank Securities [Corp.] completing our full-service capability highlighted by our first IPO (initial public offering) for Eagle Cement [Corp.],” he added.

China Bank shares closed at P33.50 each yesterday, gaining 10 centavos or 0.30% from the previous day’s finish. — K.A.N. Vidal