MANILA, Philippines — The Philippine Bank of Communications (PBCOM) posted “record” profits last year as its core lending business begins to recover amid easing pandemic restrictions.
In a stock exchange statement on Monday, PBCOM, which recently received a universal banking license, said consolidated net profit rose 34.6 percent year-on-year to 1.57 billion pesos in 2021.
This is PBCOM’s highest result since joining the Lucio Co Group in 2014, the company said. Explaining its financial performance, PBCOM attributed the growth to “improved performance in its core business and normalized provision for credit losses.”
“The Bank’s focus on core business, such as corporate lending and low-cost deposit generation, has provided the Bank with stable income despite market uncertainties,” said Patricia May Siy, President. and CEO of the company.
Investors seemed happy with the news. On Monday, shares of PBCOM rebounded 9.40%, reversing losses in the main index.
PBCOM has yet to release its full financial results, but it said net interest income grew at an annualized rate of 8.1% to 4.24 billion pula last year despite an environment of low interest rates due to the central bank’s ultra-loose monetary policy. .
Driving the growth was a 10.2% year-on-year expansion in loans and receivables to P63.5 billion, indicating a recovery in PBCOM’s lending business. This, in turn, prompted PBCOM to reduce its buffer funds against defaulted loans, a move that further boosted its revenue.
“We also believe we are in control of our non-performing loans (NPLs) as evidenced by the reduction in provisioning requirements,” Siy said. PNPs are loans that remain unpaid 30 days past the due date.
Meanwhile, non-interest revenue “posted lower” due to trading and rental income. The company did not release figures.
The volume of deposits, seen as a lifeline for banks, grew 3.8% year-on-year, driven by a rise in low-interest deposits which rose 30% annually and accounted for 60, 4% of the bank’s deposit mix last year. —Ian Nicolas Cigaral