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With consistent growth across all of its operations, BDO Unibank, Inc. (BDO) reported net income of ₱16.5 billion for the first quarter of 2023. Return on Average Common Equity (ROCE) increased from 11.09% in the same time previous year to 14.45% this year.
Total deposits rose 14% to ₱3.2 trillion while gross customer loans rose 8% to ₱2.6 trillion. The Bank has kept a solid balance between loan growth and enough liquidity for unanticipated occurrences, keeping its liquidity ratio at 35%, despite the uncertainties.
While non-interest income increased to ₱18.9 billion, net interest income increased to ₱43.4 billion thanks to strong growth in the different fee-based businesses and treasury/FX activities.
In line with increased activity, operating expenses (Opex) grew by 17%, primarily due to volume-related charges such credit card interchange fees, documentary stamp taxes, and gross receipts taxes. With 97 new branches opened since the first quarter of 2022, the Bank also maintained its IT investments and branch expansion. Pre-provision operating profit increased to ₱24.9 billion as a result of revenue growth continuing to surpass operating expense growth.
While the Bank continued to follow its cautious credit and provisioning policies, the Non-Performing Loan (NPL) ratio improved to 1.98% from 2.72% in the first quarter of this year, and NPL coverage grew from 120% to 170% YoY.
The capital base increased to 475.9 billion, and the ratios of the Capital Adequacy Ratio (CAR) and Common Equity Tier 1 (CET1) are both comfortably over the legal minimums at 14.8% and 13.7%, respectively. To reach ₱88.81, book value per share increased by 10.5% YoY.
Given its sound balance sheet, well-established business brand, and robust and diversified earnings streams, the Bank believes it is in a good position to weather short-term volatility and capitalize on long-term growth opportunities despite the fact that macroeconomic challenges still exist with still high inflation and interest rates.
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