Colfinancial.com said banks grew their combined profit by 9.3 percent in the first quarter of the year, with seven out of the nine banks in its recommended stocks posting higher net interest income.
These are BDO Unibank Inc., Bank of the Philippine Islands (BPI), China Banking Corp. , EastWest Banking Corp., Metropolitan Bank and Trust Co. (Metrobank), Philippine National Bank (PNB) and Security Bank Corp.
Relative to earnings expectations, four banks outperformed in the first quarter – BPI with its higher than expected revenues, Metrobank and PNB that reported better than expected provisions and net interest income, and Security Bank with its higher than expected net interest income.
“Conversely, one bank lagged forecasts, while the remaining three fell in line,” Colfinancial.com said.
Meanwhile, it noted continued strength in the banks’ core lending business, serving as the main driver for earnings growth in the first quarter.
The banks’ lending also outperformed expectations as all banks reported double digit growth in net interest income at a combined 19.1 percent, it added.
“The solid growth in lending income was driven primarily by the expansion of loan portfolios and improvements in net interest margins,” Colfinancial said.
Higher accrual income from the buildup of the banks’ securities portfolios also contributed to higher net interest income.
