BPI first half profit drops 15% as loan loss provisions soar

Bank of the Philippine Islands said its net income declined by 15% decline to P11.68 billion in the first semester as it put aside more than four times the provisions for credit losses than it did a year ago due to economic crisis triggered by the coronavirus outbreak.

During the period, BPI stashed P15.01 billion to cover potential defaults from the economic shock, 4.3 times more than the P3.48 billion set aside in 2019.

In the second quarter alone, net income amounted to P5.29 billion, down 24.6%.

Revenues, meanwhile, rose by 14.8% in the first half to P52.69 billion. Net interest income climbed by 12.5% to P36.4 billion amid the 5.9% expansion in average asset base.

Total Loans went up 5.9% to P1.43 trillion with growth recorded in microfinance, corporate, and consumerloan segments at 41.4%, 8.4%, 2.5%, respectively. Total Deposits increased by 6.3% to P1.76 trillion, driven by CASA deposits which grew by 11.8%

BPI ended the first semester with total assets of P2.26 trillion, up 5.8% year-on-year. Total equity, meanwhile, stood at P278.81 billion, with an indicative common equity tier 1 ratio of 15.63% and a capital adequacy ratio of 16.52%, both well above regulatory requirements.

The Ayala-led bank recently completed the offering of COVID Action Response Bonds with a tenor of 1.75 years and a coupon rate of 3.05% per annum.

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