The Philippine National Bank (PSE: PNB) posted consolidated net profits of P1.5 billion in the first three months of 2018, 20% higher compared to P1.2 billion reported a year ago, at the back of 24% year-on-year growth in core operating revenues.
The Bank’s net interest income increased by 25% to P6.4 billion from P5.2 billion reported in the same period last year, driven by higher loan volumes and improving net interest margins, while net service fees and commission income was up by 20% year-on-year to P852.1 million. Trading and foreign exchange gains however were down to P54 million from P498 million a year ago. Operating expenses, excluding provisions for impairment and credit losses, grew 14% over the same period last year, as strong revenue growth translated to higher business taxes and other business related expenses.
As of end of March 2018, PNB's total consolidated resources stood at P850.7 billion, up 8% compared to March 2017 balances, while total equity increased by P9.5 billion, to P121.2 billion from last year’s levels. The Bank expanded its loan portfolio to P502.5 billion, up 16% compared to end-March 2017 level, while total deposits increased year-on-year by 11%, to P658.1 billion. Net non-performing loans (NPL) ratio was at 0.35% while NPL coverage remain more than adequate at 131%. Common Equity Tier 1 Ratio was 14.6% and Capital Adequacy Ratio stood at 15.3%.
In April 2018, PNB issued USD300 million in Fixed Rate Senior Notes under the Bank’s Medium Term Note (MTN) Programme, the Bank’s debut issuance in the international debt markets, following a successful roadshow to investors in Singapore and Hong Kong. There was strong demand for the offering which reached approximately USD 1.2 billion at its peak, equivalent to an oversubscription of 4x the issue amount, with 118 investors registering interest at that time. The Notes, rated Baa2 by Moody’s, were issued at a price of 99.532 per 100 with a coupon rate of 4.25% per annum and a tenor of five years and one day.