EastWest Bank reported a net income of P6.2 billion in 2019, 38 percent higher than the previous year.
The income was mainly driven by the growth of its consumer loans portfolio and low-cost deposits.
The bank maintained its top-tier position in profitability with Return on Equity at 14 percent.
“We are pleased to report our highest recorded income ever even as the Bank faced a margin squeeze in 2019,” said EastWest CEO Antonio C. Moncupa, Jr.
“We expect a reversal in 2020 and recover a good part of the lost margins. Better global and domestic market liquidity should drive deposit costs lower; we also expect our balance sheet to post decent growth as the country is expected to be among the more resilient economies even with COVID-19 and the resulting slowdown in the advanced economies and China,” Moncupa added.
Net revenues rose 13 percent to P28.7 billion from P25.5 billion. Net Interest Income accounted for P2.2 billion of the P3.2 billion increase while the remaining balance comprised of Fees, Commissions, and Fixed Income trading gains grew by a combined 16 percent or by P1.0 billion.
Operating expenses, excluding provisions for losses, increased by 8 percent to end at P16.4 billion in line with the growth of its earning assets. Cost-to-income ratio improved to 57 percent from last year’s 60 percent.
Provisions for losses went up by 3 percent to P4.0 billion, slower than the 9 percent increase in its total loan portfolio.
Consumer loans increased by 14 percent. EastWest remains the most consumer-centric universal bank in the Philippines, with consumer loans accounting for 73 percent of its total loans.
EastWest’s net interest margin was at 6.9 percent for the full year, lower than the 7.4 percent it registered in 2018. Margins recovered to 7.6 percent in the last quarter from the 6.4 percent dip in the first quarter of 2019, where deposit costs went to record highs due to tight market liquidity, which improved considerably in the last five months of 2019.
Total deposits meanwhile grew by 6 percent to P304.7 billion, with CASA deposits growing by 28 percent. Overall, total assets grew by 11 percent to end at P406.3 billion.