The Bank’s core businesses remained strong. Deposits grew by 7% year on year. Loans also sustained its growth, increasing by 20% as lending to all segments continued to be vibrant. Assets under management reached P716 billion, 15% higher than prior year.
As interest rates showed some volatility in the first few months of the year while the equity markets continued its uptrend, the Bank sold down some of its securities inventory and realized around P3.7 billion in trading gains. Notwithstanding, net interest income improved by 8% and was 12 basis points ahead of the previous year. Other income was also better mainly due to higher insurance income and trust fees.
With the extraordinary level of revenues contributed by one-off trading gains, the Bank took the opportunity to accelerate its contribution to its retirement fund for the fund to earn more and compensate for the estimated lower investment yield for the rest of the year. Operating expenses were thus higher by 17% largely on increases in manpower cost, premises, technology, and variable costs. Impairment losses were also higher due to additional provisions for non-credit related items like actuarial reserves for the pre-need insurance business.
Asset quality improved further as reflected in its net 30-day NPL ratio of 2.0%, down from last year’s 2.4%. Reserve cover was 130%.
BPI’s market capitalization stood at P263 billion at end of first quarter. Its Basel 2 Capital Adequacy Ratio (CAR) was 15.5%.
The Bangko Sentral ng Pilipinas approved the Bank’s declaration of a special cash dividend of P0.50 per share in addition to its regular cash dividend of P0.90 per share for the first half of the year. These are payable on May 12.
Mr. Aurelio R. Montinola III, BPI President commented, "As uncertainty in the global economy still prevails, we decided to realize our securities trading gains early in the year. We strongly believe in organic growth, and our hard work is paying off. While our first quarter results were excellent, this should not be construed as an indication of the succeeding quarters in view of the one-off securities trading gains. We will continue to focus on growing our core income guided by our goals of quality sustainable growth, customer experience innovation and team-oriented employee engagement.”
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