The Philippine National Bank (PNB) said net income rose in the third quarter after going largely against the grain of the industry with reduced provisioning levels during the period, though provisions during the nine months were more than six times their year- earlier levels.
PNB earnings rose 4% to P2.5 billion in the three months to September, it said in a disclosure to the bourse Friday. It set aside loan loss provisions of P587 million during the period, down from P618 million a year earlier.
On a nine-month basis, provisioning rose to P9 billion from P1.4 billion a year earlier. The third-quarter earnings accounted for about 64% of the nine-month profit of P3.9 billion.
Over the nine months, PNB said pre-provision operating income rose 42% to P14.1 billion.
Net interest income rose 12% to P26.2 billion in the year to date.
“(This was) driven by lower funding costs due to the stable growth in low-cost deposits combined with the significant reduction in levels of high-cost deposits, particularly with the maturity of P7 billion worth of long-term negotiable certificates of time deposit," PNB said.
Interest income from loans and receivables declined 3% to P28.7 billion in the nine months, with the bank saying it was “focused on strengthening its liquidity position.” Pre-provision operating costs were flat at P20 billion. PNB said it managed its expenses "despite the supplemental costs for frontline employees" for operations during the pandemic, and following the rationalization of non-critical expenditures.
Assets stood at P1.03 trillion at the end of September from P1.14 trillion at the end of 2019.
The capital adequacy ratio was 16.40% and common equity tier-1 ratio 15.67%. PNB closed at P28.80 Friday, up 45 centavos.