Makati City, Philippines --- Bank of the Philippine Islands (“BPI”) generated net income of Php 30.5 Bn for the first nine months of 2022 on higher revenues and lower provisions. Return on Equity stood at 13.73% and Return on Assets at 1.66%. Excluding the impact of the one-off gain from sale of property in the second quarter and adjustments due to the CREATE Law, net income would have been Php 26.8 Bn for an ROE of 12.05% and ROA of 1.46%.
Total revenues reached Php 87.5 Bn, up 22.1% year-on-year, boosted by the 20.5% growth in net interest income to Php 61.6Bn on the back of continued loan growth and sustained expansion in average net interest margin for the year by 23 bps to 3.53%. Non-interest income grew 26.2% to Php 25.8 Bn driven by the one-off gain in asset sale, gains in foreign exchange transactions and fees from the credit cards business.
Total operating expenses stood at Php 40.1 Bn, up 9.9% compared to the previous year, on higher regulatory, technology and transaction-related costs. Cost-to-income (“CIR”) ratio was 45.8%. Excluding the impact of the asset sale, CIR was at 48.6%.
The Bank booked provisions of Php 7.5 Bn, a 26.8% reduction from last year. Asset quality continued to improve with NPL ratio at 1.94% and NPL coverage ratio at 176.9% as of September 2022. Taxes paid and accrued rose to Php 17.2 Bn.
For the third quarter of the year, the Bank generated net income of Php 10.1 Bn driven by higher revenue growth to Php 29.8 Bn, up 26.8% on double-digit growth from net interest income and non-interest income, and growth in the customer base to over 9 million.
As of September 30, 2022, total loans stood at Php 1.6 Tn, up 15.4% year-on-year, led by growth in the credit card, corporate/SME and auto portfolios of 29.1%, 16.4%, and 12.1%, respectively. Total deposits expanded to Php 2.0 Tn, up 13.2% year-on-year, while CASA increased 7.5%. CASA Ratio stood at 76.1% and Loan-to-Deposit Ratio at 78.7% as of end September 2022.
Total assets reached Php 2.5 Tn, reflecting an 11.8% growth year-on-year. Total equity stood at Php 313.4 Bn, with an indicative Common Equity Tier 1 Ratio of 15.9% and a Capital Adequacy Ratio of 16.8%, both above regulatory requirements.
On September 30, 2022, BPI announced merger plans with Robinsons Bank Corporation with BPI emerging as the surviving entity, subject to shareholders and regulatory approvals. The merger, which the parties hope to complete before the end of 2023, will unlock various synergies across several products and service platforms and expand the customer and deposit base of both banks through the merged entity.