State-owned Development Bank of the Philippines’ (DBP) net earnings slipped in the third quarter due to higher provisions for impairment losses and taxes as well as growing operating expenses.

In a press release on Thursday, DBP said its net profit went down 1.56% to P4.42 billion in the July-September period from the P4.49 billion it booked in the same quarter last year.

“DBP remains confident of reaching its financial targets for this year. We have already achieved 75% of our net income target for 2019 due to a realization rate of 103% on our net income target for the third quarter,” DBP President and Chief Executive Officer Emmanuel G. Herbosa was quoted in the statement.

Mr. Herbosa said DBP, which is the country’s official infrastructure bank, saw its loan portfolio increase by 33.8% in the third quarter to P329.1 billion from P246 billion in the same period a year ago.

Of this total 40% or P152 billion went to the infrastructure and logistics sector, followed by loans to social services worth P67.33 billion, credit for environmental projects worth P44.6 billion and loans to micro, small and medium enterprises totalling P24.6 billion.

He said the credit growth was driven by the bank’s “aggressive lending activities” via its 22 lending centers that have streamlined credit application processes.

“DBP will continue with its drive to promote economic inclusion and remain a relevant and responsive partner of the national government in promoting sustainable development particularly in the countryside,” Mr. Herbosa said.

Meanwhile, the lender’s gross income climbed 28.6% to P24.2 billion in the third quarter from P18.9 billion from a year earlier.

As of end-September, its total deposits went up by 12.1% to P502 billion from P447.8 billion from a year ago “backed by aggressive deposit generation activities.”

The bank’s capital adequacy ratio stood at 14.7% as of end-September, relatively higher compared to the industry average of 12.2%, the bank said.

The projects it funded in the infrastructure and logistics sector include energy, water resources, information and communication technology, transportation, construction, and manufacturing initiatives in Central Luzon, Davao, Central Visayas as well as in the regions of Cavite-Laguna-Batangas-Rizal-Quezon or CALABARZON and the National Capital Region.

As for social infrastructure projects, Mr. Herbosa said that among the DBP-funded ones are health care, education, housing, and solid waste management initiatives, especially in underserved provinces and municipalities nationwide.

DBP is the eighth largest bank in the country in terms of assets with P700.9 billion on record as of end-September. It targets to become a P1-trillion bank in terms of assets by 2022.

So far, the bank has 137 branches including 10 branch-lite units and a total of 833 automated teller machines spread across the country. — Beatrice M. Laforga