Philippine National Bank started the year with a strong growth in profitability as it posted a consolidated net income of P4.8 billion in the first quarter of 2023, 71 percent higher than year-ago net results, driven by robust increases in interest margins, fee-based income and gains on disposal of the bank’s foreclosed properties.
Income from core businesses continued to show progress as the Bank’s net interest income rose by 23 percent year-on-year to reach P10.5 billion due to improvement in loan-to-deposit ratio to 70 percent from 65 percent a year ago, as well as higher yield rates on earning assets amid the rising interest rate environment.
As a result, the bank turned in better net interest margin of 4.22 percent in the first quarter of 2023 against 3.39 percent a year ago. Fee-based revenues likewise grew by 24 percent year-on-year to P1.6 billion on the back of increases in volume of credit and deposit-related transactions.
“PNB’s core earnings has been increasing,” President Florido Casuela said. “We remain focused on improving efficiencies and in supporting our customers, their businesses and our stakeholders capture opportunities presented by the thriving economy,” he added.
During the first quarter of 2023, the bank continued its strategy to dispose and monetize the values of its foreclosed properties, translating to net gains on sale and exchange of assets of P2.6 billion, which is 19 times higher than the gains recorded in the same quarter last year. Despite the limited trading opportunities and market liquidity, the Bank also managed to double its net trading and foreign exchange gains from last year to P387.6 million as it took advantage of the rate movements in the market during the period.
Operating expenses moderately increased by 12 percent year-on-year mainly due to the taxes related to the property sales.
As of end-March 2023, the bank’s gross loan portfolio expanded by 4 percent versus the previous year to P609.0 billion, propelled by higher lending to large corporates and commercial, small-and-medium-sized entities.
