By James A. Loyola
Gotianun-led EastWest Bank (EW) reported a 60 percent jump in net income to P3.75 billion for the first nine months of the year, bucking the industry trend and sustaining the 60 percent growth in the first half of 2017.
The bank maintained its industry-leading net interest margin (NIM) of 7.8 percent. NIM, net of provisions for loan losses, a metric that makes comparison among banks more meaningful, was at 6.1 percent.
The bank’s recurring earnings grew 24 percent to P18.0 billion as net interest income and fee-based income, excluding trading gains rose 22 percent and 30 percent, respectively.
Total non-interest income grew 5 percent year-on-year, tempered by the 70 percent dip in profits from securities trading.
Net revenues reached P18.4 billion, 17 percent higher year-on-year. Operating expenses were at P9.9 billion, and increased at a slightly slower pace of 16 percent.
“We are happy to note that our higher income is mainly due to improving productivity and lower loan loss provisions,” EW President Bobby Reyes said.
He added that, “these two items more than offset the much lower trading revenues and the substantial increase in taxes even as our NPL (non-performing loan) loan loss coverage significantly improved.”
Total assets grew 17 percent to P314.9 billion driven by the growth in the bank’s loan portfolio. Total loans increased 18 percent to P216.3 billion.
Consumer loans, which grew 29 percent, account for 72 percent of total loans. Growth in consumer loans was led by the bank’s auto loans business.
Total deposits rose 19 percent to P257.1 billion as low-cost deposits grew 23 percent.
“Our third quarter results prove that we are on the right track. EastWest is a true retail bank whose strength lies in its core operations,” Reyes said.