Big Banks Register 15% Annual Earnings Growth in 9 Months
The country's 37 universal and commercial banks reported a 15 percent year-on-year income growth for the first nine months of the year as loans and deposits, as well as trading gains continue to prop up profits.
Based on data from the Bangko Sentral ng Pilipinas (BSP), as of the end of the third quarter, the big banks posted profits of P80.113 billion, up from same period last year of P69.628 billion.
The universal and commercial banks, which control 97 percent of the total banking resources, reported modest net interest income growth of 2.8 percent to P149.239 billion.
The trading gains-driven non-interest income however surged 16 percent year-on-year to P96.88 billion. Trading in treasuries or securities continue to be one of the industry's main but largely speculative source of revenues.
For the third quarter period, the big banks' return on equity rate dropped to 12.33 percent from the same time in 2011 of 12.44 percent. Return on assets, in the meantime, rose to 1.58 percent from 1.52 percent.
BSP data also showed that the banks' cost to income ratio was higher at 63.74 percent from 62.7 percent last year.
In a report the central bank said the expanding economy, which grew 7.1 percent in the third quarter for a full nine-month growth of 6.5 percent and exceeding the 5-6 percent government targets for 2012, is providing the banking system ample range to grow and help it fulfill its role of strengthening the financial system.
With banks' delivering double-digit growth for the past year on expanding loans, deposits and assets accounts, the BSP said asset quality and solvency indicators have been improving. …