Philippine Savings Bank (PSBank)’s first half 2012 net income surged to P1.38 billion, 50% or P459 million higher compared to the same period last year, primarily on gains in its investments as well as strong growth from its loan portfolio.
The Bank’s gross loans rose by 14% to P67.0 billion with double digit growth rates coming from its consumer loans as well as its Large Enterprise Group (LEG) loans. More specifically, Auto and Mortgage loans grew by 15% and 14% respectively due to higher demand and improved penetration in PSBank’s branch, dealer and developer channels. Corporate loans, under LEG, likewise went up by 28%.
Deposits grew by P7.0 billion from the previous year. The Bank opened 11 additional branches in the first six months of the year thus increasing its branch network to 211. PSBank further expanded its ATM network and now has 520 onsite and offsite ATMs all over the country.
Capital also went up by 15% to P14.3 billion. Capital adequacy ratio is higher at 17.96% while its Tier 1 Capital ratio is at 14.15% -- above BSP’s proposed Basel 3 limits of 12.5% and 8.5% respectively.
Net revenue jumped to P5.9 billion or a P2.2 billion increase compared to the previous year as the Bank recognized gains from its investments in government securities as well as a 7% growth in its interest income on loans.
PSBank set aside provisions amounting to P1.1 billion for the first six months of the year to further strengthen its balance sheet. Coverage ratio thus improved to 103% even as its NPL ratio went down to only 3.0% of its loan portfolio.
"We are pleasantly surprised by the strength of loan demand, particularly for mortgage loans. New loan releases for acquisition of houses and condominiums have surged by 50% from last year. If this pace holds up in the second half, our loan portfolio will be 18% to 20% higher than previous year,” PSBank President Pascual M. GarciaI said.
"However, while loan demand is robust, margins are declining due to competitive loan pricing by banks. This, coupled with less trading opportunities, may moderate profit growth in the second half,” he added.
PSBank was recently recognized as a Silver Awardee by the Institute of Corporate Directors (ICD) for being one of the top scoring publicly listed companies in the 2011 Corporate Governance Scorecard. The Bank was the only savings bank from among 23 silver awardees.
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