PNB profits rise due to asset swap – Manila Bulletin
The Philippine National Bank reported that its net income jumped to 31.7 billion pesos last year, 12 times more than the previous year’s net income, mainly due to an exchange of goods for shares with a subsidiary.
In a statement to the Philippine Stock Exchange on Wednesday, March 16, the bank said it recorded a gain of 33.4 billion pesos from the property-for-equity swap concluded last year with PNB Holdings Corporation.
It’s part of a series of deals that aim to monetize the value of the bank’s low-income assets.
PNB said its income from core banking increased by 2% to P40.1 billion despite the continued impact of the COVID-19 pandemic.
“PNB has continued to be profitable and has been able to provide non-stop banking services to customers and the general public during the pandemic,” said PNB President and CEO Wick Veloso.
He added that “we have continued to play our part in supporting customers and employees by implementing safer banking processes and services amid the ongoing pandemic situation.”
Net fees and commissions increased by 43%, driven by increased lending and deposit transactions, as well as large bancassurance and underwriting agreements entered into during the year.
This was complemented by the upward pull in fees due to the increasing use of the Bank’s digital platform.
The Bank reported net interest income of 34.8 billion pesos in 2021, which is relatively stable year-on-year, and managed to maintain its net interest margin at 3.2% .
PNB’s loan portfolio increased by 1% to reach 607.0 billion pesos at the end of 2021, while total deposits increased year-on-year by 4.6 billion pesos, closing at 894.9 billion pesos at the end of 2021.
It recorded trading and foreign exchange gains of 1.5 billion pesos in 2021. This figure was 65% lower year-on-year as in 2020 the bank took advantage of lower interest rates. reference interest to offload a significant part of its transactions. wallet.
While PNB continued to build up its loss reserves on loans from borrowers directly affected by the pandemic, it recorded much lower impairment and credit provisions in 2021 of 24%.
As part of its ongoing strategy to reduce its non-performing loans (NPLs), the Bank sold some NPLs in 2021 with gross book values before the sale of 5.5 billion pesos, resulting in a gain on the sale of 767.0 million pesos.
Operating expenses, excluding provisions, are also 6% lower compared to the previous year, as the Bank focuses on more essential expenses, particularly in these difficult times.
The NBI capital adequacy ratio of 13.66% and the Common Equity Tier 1 capital ratio of 12.96% remained above the minimum regulatory requirement of 10%.
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