China Banking Corporation posted better-than-expected financial results in 2022 on the back of robust operating income and effective cost management.
Consolidated net income grew by 27 percent year-on-year to P19.1 billion, which translated to a higher Return on Equity of 15.1 percent and Return on Assets of 1.6 percent.
“Our sustained strong performance amid macroeconomic headwinds is a testament to our unwavering customer focus, effective management of assets, and good cost control,” said China Bank President William C. Whang.
Total revenues increased by 14 percent to P55.7 billion, driven by the 17 percent jump in net interest income to P45.6 billion. Interest income grew by 23 percent to P57.2 billion due to the continuous build-up in earning assets. Despite the 57 percent growth in interest expenses, the Bank’s net interest margin remained healthy at 4.2 percent. Meanwhile, fee-based income grew by 5 percent to P10.1 billion due to notable improvements in core fee income, including deposit-related transaction fees, trust revenues, bancassurance commissions, and fees from our investment banking, stock brokerage, and insurance brokerage businesses.
Operating expenses increased by 9 percent to P24.4 billion from biggerrevenue-related taxes due to business growth and higher core operating expenses due to inflationary pressures. Nonetheless, the Bank’s cost-to-income ratio improved to 44 percent.
China Bank remains as the 4th largest privately-owned domestic bank with total assets of P1.3 trillion, up 20 percent, bolstered by robust earning assets and deposits expansion.
Net loans rose by 15 percent to P700 billion on vigorous business and consumer lending to drive economic rebound. Even with this increase, the Bank recorded better-than-industry nonperforming loan (NPL) ratio and NPL coverage ratio of 2.3 percent and 123 percent, respectively.
Total deposits reached P1.1 trillion, 24 percent higher on sustained growth across deposit products. Current and savings account (CASA) deposits increased to P573 billion for a CASA ratio of 54 percent.
Total equity stood at P135 billion, up 13 percent, with a common equity tier 1 (CET1) ratio of 15.1 percent and total capital adequacy ratio (CAR) of 15.9 percent.
“China Bank continues to be strong and profitable, with ample liquidity and capitalization to achieve our ambitious goals, and more importantly, to deliver long-term, sustainable value to our stakeholders,” said China Bank Chief Finance Officer Patrick D. Cheng.
Chief Operating Officer and incoming China Bank President & CEO Romeo Uyan Jr. is excited about the possibilities ahead for the bank. “These results were made possible by the hard work and dedication of our employees. Our investments over the past years have started to bear fruit as evidenced by the record growth in assets and profits that we have been reporting. We also will keep on investing in our people and capabilities as China Bank continues to play an increasing role as one of the preeminent institutions in the Philippine banking industry.”
