July 27, 2015

BDO nets P11.7b in 1H15

In a disclosure to the Exchange, BDO Unibank (BDO) said that its net income for 1H15 reached P11.7b, up 6% YoY. The bank grew its loan portfolio by 16% to P1.1t, while CASA deposits grew by 17% YoY. This enabled net interest income to grow to P27.1b, up 10% YoY.

Meanwhile, the bank’s income from fee-based services and treasury activities increased by 14%. The bank was able to keep opex growth at 10%. NPL ratio dropped to 1.2% from 1.6% in the same period last year, even as the bank’s NPL cover increased to198% from 174% last year.

Our take: The bank’s 1H15 earnings are slightly trailing our forecast, accounting for 46% of our 2015E estimate. 1H15 net interest income likewise accounted for 46% of our 2015E estimate. We also note that although loans grew 16% YoY, net interest income only grew 10% YoY, implying possibly higher interest expenses.

On a quarterly basis, the bank’s 2Q15 earnings were down 8.2% vs. 1Q15 earnings, which was boosted by better-than-expected trading gains. We shall review BDO’s 1H15 results once the bank’s detailed financials are released. – WealthSec