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June 22, 2024

China Bank books 37% rise in Q1 earnings to P4.9B

China Banking Corp. headed by bankero William Whang registered a 37 percent jump in net income to P4.9 billion in the first quarter of the year from P3.6 billion in the same quarter last year on the back of sustained core business growth.

“China Bank’s organic growth momentum continues—loans and deposits are up, expenses are down, and credit quality remains solid,” the bankero said.

This translated to a higher return on equity of 16 percent and a better return on assets of 1.7 percent.

As the economy continues to recover from the COVID-19 pandemic, China Bank’s net interest income grew by 15 percent to P10.8 billion from January to March this year compared to P9.3 billion in the same quarter last year on the back of higher earning assets and lower interest expense.

Net interest margin further improved to 4.3 percent from 4.2 percent.

The bank’s revenues slipped by two percent to P12.5 billion from P12.7 billion as lower trading gains pulled down fee-based income by 50 percent to P1.7 billion from P3.4 billion.

This wiped out the eight percent increase in service charges, fees, and commissions as well as the 22 percent jump in trust fees.

China Bank’s provision for potential loan losses plunged by 65 percent to P780 million from P2.2 billion improved macro-economic outlook that led to a lower non-performing loan (NPL) ratio of 2.5 percent form 3.8 percent.

Despite the lower provisioning, the bank’s NPL cover increased to 119 percent from 86 percent.

According to China Bank, operating expenses declined by eight percent to P5.7 billion in the first quarter of the year from P6.2 billion in the same quarter last year on prudent cost management.

Its loan portfolio grew by 10 percent to P632 billion, while total deposits went up by eight percent to P879 billion translating to a 12 percent expansion in total assets to P1.1 trillion.

“Our effective asset-liability management and solid capital structure have allowed clients to access our balance sheet and enabled us to achieve better-than-industry growths in assets, loans, and equity,” China Bank chief finance officer Patrick Cheng said.