2019 April – BDO Unibank, Inc. reported at its stockholders meeting today its full year 2018 results, with net income hitting a record P32.7 billion.
 

BDO’s 2018 net income represents a 17% growth and beats the P31.0 billion full-year guidance. The country’s largest bank* likewise capped another milestone as the first Philippine bank to surpass the P3 trillion mark in total assets.
 

BDO attributed its solid performance to strong recurring earnings from its core businesses, with sustained loan and deposit expansion on its continued branch build out in key growth areas and new markets, particularly the underserved sectors.
 

Q1 2019 Results
 

The Bank sustained its growth momentum through the first quarter of this year, with net income advancing to P9.8 billion. This achievement was due to the continued expansion of its core banking operations, recovery of trading gains to normal levels, and strong results from bank fees and life insurance premiums.
 

Net interest income was a major earnings driver, rising to P27.7 billion on the continued growth in customer loans and CASA expansion, resulting in higher net interest margins. Meanwhile, non-interest income went up to P14.9 billion, led by banking fees and insurance premiums. Trading and FX gains normalized to P2.2 billion from just P24 million a year-ago, given adverse market conditions during Q1 2018 when the market declined by 7%. Excluding the increase in trading gains, core net income would have risen by 21%. 
 

Operating expenses rose by 22% to P28.3 billion. Exclusive of policy reserves and volume-related expenses, Opex growth would have been 13% due primarily to continuing business and branch expansion as well as investments in IT upgrades implemented early this year.
 

Meanwhile, the Bank set aside P1.3 billion in provisions, with gross non-performing loan (NPL) ratio steady at 1.2%, and NPL cover higher at 163% from 156% in the first quarter of 2018. Return on Common Equity (ROCE) however, stood at 11.8%, still below regional peers.
 

The Bank’s capital base increased to P338.4 billion, with Capital Adequacy Ratio (CAR) and Common Equity Tier 1 (CET1) at 14.0% and 12.4%, respectively.

BDO set its earnings guidance at P38.5 billion for the full-year 2019, as the Bank leverages on its strong business franchise and extensive distribution network while executing its strategy to expand across high-growth areas and underserved segments.

Read our 2018 Annual Report here.

*As of December 31, 2018, BDO Unibank Inc. ranks as the country’s largest bank in terms of total assets, loans, deposits, and trust funds under management based on published statements of condition.

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