LAND BANK of the Philippines (LANDBANK) posted a higher net income in the second quarter of the year propelled by steady growth in its loan portfolio.
In a statement sent to reporters on Tuesday, the state-led bank said it logged a net income of P7.8 billion in the April-June period, 5.4% more than the P7.4 billion booked in the same period last year.
LANDBANK President and Chief Executive Officer Alex V. Buenaventura said the increase in its net income was boosted by steady growth in its loan portfolio.
The lender’s total loan book expanded by 27% to P758.7 billion as of end-June from P597.1 billion in the comparable year-ago period, with revenues from loans climbing 30%.
Deposits also grew 15% to P1.5 trillion from P1.3 trillion as of June last year.
Return on equity stood at 13.4%, well above the latest industry average and surpassing the levels reported by the country’s top four banks. LANDBANK’s net interest margin was also above industry average at 3.32%.
Overall, the bank’s assets rose 14% to P1.7 trillion from a year-ago level of P1.48 trillion. Its capital, on the other hand, stood at P117.4 billion.
Mr. Buenaventura said LANDBANK remains among the most profitable banks in the country.
“We are confident about continued growth for the next half of the year,” he was quoted as saying in the statement. “We work hard to maintain the bank’s sound financial position as the profits from our commercial banking operations allow us to further drive support to our priority sectors, especially farmers and fishers.”
In a recent interview, Mr. Buenaventura said the bank sees its loan portfolio growing by “more than 25%” this year supported by corporate and local government financing.
“Our loans are so positive. The credit demand based on our increase in loan portfolio versus last year is so big. It’s a record growth,” Mr. Buenaventura told BusinessWorld.
“Our loans from local government units are very, very strong. Local governments are growing and progressive,” the LANDBANK chief said.
Aside from this, corporate loans will also support the lending expansion of the bank as companies grow their businesses rapidly.
“Our corporate loans are also equally strong. As you know, corporate income is good, and they are in a very expansive mood. This will also drive our growth,” the chief executive added.
Mr. Buenaventura also said the lender is on track to hit its profit target of P16 billion for the year. If met, this will be a climb from its P14.05-billion net profit last year. — Karl Angelo N. Vidal