PSBank hikes profit by 14% to P3 billion

MANILA, Philippines — Mid-sized Philippine Savings Bank (PSBank) recorded a double-digit 14 percent growth in earnings to P3 billion last year from P2.66 billion in 2018 despite volatile environment.

PSBank president Jose Vicente Alde said the bank’s strategy on core growth brought positive results amid volatile environment last year.

“Challenges were met head on, reinforced by significant contributions from all the bank’s business units. We had big wins during the year as we were able to focus on operational efficiency and sustained cost discipline across the organization,” Alde said.

Alde said the bank’s net income came from the growth of both its core net interest margin and other operating income, supplemented by upsides from operating efficiencies.

The bank also recorded a 2.8 percent rise in revenues to P14.6 billion in 2019 from P14.2 billion in 2018, while operating expenses, excluding the provision for impairment and credit losses declined by 2.8 percent to P8.91 billion from P8.65 billion.

The country’s second largest thrift bank reported a 4.7 percent increase in loan book to P164.11 billion from P156.7 billion, driven by its consumer loan business.

Despite an increase in risk assets, PSBank’s non-performing loan (NPL) ratio improved to 3.6 percent from 4.2 percent in the previous year from continued improvements in credit quality.

The listed bank’s asset base slipped by 5.4 percent to P224.91 billion from P237.7 billion.

The bank’s deposits declined by 14 percent to P172.51 billion last year from P200.7 billion as it continued to rebalance its funding mix to focus on retail and alternative sources.

Last month, the thrift bank returned to the domestic debt market via the issuance of peso fixed-rate bonds where it raised P4.65 billion. It also raised P6.3 billion in its maiden issuance of fixed rate bonds in July last year.

PSBank has launched a P40 billion funding program to give the bank an opportunity to access long-term funding as it expands its consumer banking business and at the same time diversify its funding base.

Its capital adequacy ratio improved to 17.8 percent from 13.9 percent, while common equity tier 1 ratio also improved to 16.8 percent from 11.3 percent, both well above the minimum required level by the Bangko Sentral ng Pilipinas.

PSBank currently has 250 branches and 557 ATMs strategically located nationwide.