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December 06, 2022

China Bank earnings hit record P5B in Q2, jump 39% to P10.1B in H1

The earnings of China Banking Corp. led by bankero William Whang reached a record P5 billion in the second quarter, translating to a 39 percent jump in net income to P10.1 billion in the first semester of the year.

“The sustained growth puts China Bank in a stronger position to support customers and the economy in this period of recovery,” the bankero said.

Throughout the COVID-19 pandemic, China Bank chief finance officer Patrick Cheng said the Sy-led bank has consistently recorded quarterly income growth.

“For the 2Q 2022 period, China Bank’s net income breached the P5-billion mark, a first in the Bank’s more than 100-year-old franchise,” Cheng said.

The robust income, driven mainly by higher net interest income and core fee income, as well as lower provisions, translated to a better return on equity and return on assets at 16.4 percent and 1.7 percent, respectively.

Net interest income rose 16 percent to P22 billion on the back of stronger top line revenues and steady movement in interest expense. As a result, net interest margin was maintained at 4.3 percent.

The decline in trading and foreign exchange gains weakened fee-based income to P3.2 billion. Nevertheless, core fee income increased 24 percent, driven mainly by double-digit growths in service charges, fees, and commissions, income from sale of acquired assets, and bancassurance.

Reflecting its positive economic outlook and its improving asset quality, credit provisions fell by 69 percent to P1.7 billion as gross non-performing loans (NPL) ratio improved to 2.3 percent from 3.5 percent.

China Bank remains one of the largest banks in the country. As of June 2022, consolidated assets were recorded at P1.2 trillion, up 17 percent.

Loans expanded 14 percent to P655 billion on the back of significant growths in both business and consumer loans, while total deposits likewise increased 14 percent to P945 billion.

Total equity jumped 16 percent to P127 billion with Common Equity Tier 1 Ratio and Total Capital Adequacy Ratio of 14.8 percent and 15.7 percent, respectively, well above the minimum regulatory requirement.

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