DBP profit drops 12.8%

MANILA, Philippines - The Development Bank of the Philippines posted a net profit of P4.6 billion in 2014, down 12.8 percent from P5.28 billion in 2013. 

Nonetheless, the government financial institution’s performance translates to a favorable return on equity of 11.01 percent and return on assets of 1.03 percent.

Trading gains declined to P2.084 billion last year from P2.762 billion the previous year.

This was offset by higher interest income from investments in debt securities (P1.472 billion) and regular loans (P870 million) and higher foreign exchange gains (P287 million).

The growth in income from loans and investments marks the shift to more recurring sources of income, in line with the bank’s strategic direction to refocus on its core lending and investing businesses.

In government securities, DBP increased its presence in the financial markets. The Bureau of Treasury awarded DBP the third Best Performing Government Securities Eligible Dealer in 2014, a big jump from its 10th rank in 2013.

Total deposits climbed 17 percent to P293.5 billion, paced by low cost funds – also referred to as current and savings accounts (CASA), which grew 8.5 percent to P201.0 billion, resulting in a 68 percent low cost to high cost deposit ratio.  

“The high deposit growth rate, coupled by the high proportion of low cost funds, helped the bank improve on its net interest margin to 2.34 percent from 2.15 percent in the previous year,” the bank said in a statement.

Net loans and other receivables increased 24 percent to P199.7 billion, with the bulk of the increase accounted for by regular loans worth P18.8 billion.