PHILIPPINE National Bank’s (PNB) net income rose by 11.56% to P15.06 billion at end-September from P13.5 billion a year ago, driven by growth in its net interest earnings amid a high rate environment, it said on Monday.

“The bank’s core revenues steadily increased as we continue to enhance our policies and processes to sustain the growth momentum of the bank’s core banking activities amidst continued economic expansion,” PNB Chief Financial Officer Francis B. Albalate said in a statement disclosed to the stock exchange.

PNB’s financial statement was unavailable as of press time.

The bank’s net interest income grew by 10.41% year on year to P36.48 billion in the first nine months from P33.04 billion, accounting for the bulk or 83% of its total operating income.

The increase was driven by the 15% growth in its interest income “arising from the expansion in loans to customers as well as investments and other liquid placements, combined with improvement in the yields,” PNB said.

“On the other hand, the higher interest expense on deposits was contained by deploying these deposits to fund assets with better yield,” it added.

Meanwhile, its net service fees and commission income went down by 16.55% to P3.58 billion from P4.29 billion.

Other operating income stood at P4.1 billion at end-September, declining by 31.21% from P5.96 billion a year ago, as the 2023 level “included gains from the sale of foreclosed assets amounting to P3.7 billion,” PNB said.

“Excluding these non-recurring gains on the sale of foreclosed assets, the increase in other operating income remains high at 31% year-on-year, boosted by superior trading income anchored on strategic positioning and timely churning of books,” it said.

The bank’s income from trading, investment securities and foreign exchange gains rose by 25.76% to P1.66 billion from P1.32 billion.

Meanwhile, operating expenses inched up by 1.17% to P21.67 billion from P21.42 billion amid higher business taxes and business-related expenses.

It set aside credit provisions worth P3.72 billion in the period, it added, 27.77% lower than P5.15 billion a year ago amid improving asset quality.

The bank’s loans and receivables inched up to P620.09 billion at end-September from P616.71 billion at end-December 2023, its consolidated statements of condition showed.

On the funding side, its deposit liabilities rose by 1.54% to P942.22 billion from P927.97 billion at end-2023.

PNB’s consolidated assets stood at P1.2 trillion at end-September, up by 2% from the year-ago level, amid increased loans and treasury assets.

“The bank’s reported income for the period raised its total equity by 13% year-on-year to reach P210.1 billion,” it said.

“The parent bank’s capital adequacy ratio stands at 17.8% and common equity Tier 1 ratio is at 16.9%, which are way above the minimum regulatory requirements,” PNB added.

PNB shares went down by five centavos or 0.18% to close at P27.05 each on Monday. — L.M.J.C. Jocson