Bank of the Philippine Islands FY 2023 Net Income Hit PHP51.7B, Up 31%

The Bank of the Philippine Islands reported its highest full-year net income of P51.7 billion, up 30.5% from the previous year's P39.6 billion, because of record revenues and lower provisions that offset an increase in operating expenses.

Net income would increase by 44.1%, excluding the one-time gain from the 2022 property sale. Fourth-quarter net income was P13.1 billion, up 44.3% year on year, because of better revenue growth and reduced provision recognition. The bank's strong financial success is due to its improved client franchise and greater customer engagement, which resulted in record volumes and market share gains in various areas. In 2023, the return on equity was 15.35%, while the return on assets was 1.93%.

Total revenues increased 16.7% year on year to P138.3 billion, attributed to a 22.7% growth in net interest income to P104.4 billion as the average asset base expanded 7.7% and the net interest margin improved 50 basis points to 4.09%. Non-interest revenue increased 1.5% to P34.0 billion on the back of record trading income gains of P5.2 billion, up 37.0% year on year, offset by a 3.0% fall in fee income to P28.8 billion. Without the impact of the 2022 one-time transaction, fee income would increase by P4.1 billion, or 16.6%, due to higher fees from credit cards, other service charges, and bancassurances.

Operating expenses rose 19.2% to P69.1 billion, driven by rising labor, technology, and marketing costs, resulting in a cost-to-income ratio of 50.0%.

The bank recorded provisions of P4.0 billion, a 56.4% decrease from last year. Asset quality is solid, with an NPL ratio of 1.84% and sufficient NPL coverage of 156.1% at the end of the year.

Total loans stood at P1.9 trillion, up 10.5% from the previous year, owing to significant growth across all portfolios. Total deposits amounted to P2.3 trillion, up 9.5% year on year, primarily due to an increase in time deposits, which offset the fall in CASA. The CASA ratio was 67.0%, with a loan-to-deposit ratio of 82.0%.

Total assets hit P2.9 trillion, representing a 10.9% increase year on year. Total equity amounted to P357.2 billion, with an indicative Common Equity Tier 1 ratio of 15.3% and a capital adequacy ratio of 16.2%, both significantly higher than statutory standards.
​
The merger of BPI and Robinsons Bank Corporation became effective on January 1, 2024, with BPI as the surviving corporation. This merger would broaden the reach and improve the overall banking experience of its consumers by using synergies between the BPI Group and Gokongwei ecosystems.