Ayala-led Bank of the Philippine Islands posted a 5.7-percent drop in first semester net profit to P11.03 billion due to the decline in its treasury, trust and investment management businesses.
Six-month net interest income expanded by 11.5 percent year-on-year to P26.21 billion given an increase in the loan book and an improvement in net interest margin (NIM).
In a statement, BPI reported that average asset base grew by 9.3 percent while NIM improved by 8 basis points.
Interest income from loans grew by 21.1 percent year-on-year, driven by a 16-basis point improvement in loan yields. However, cost of funds increased by 17 basis points for the period partly due to higher documentary stamp tax (DST) on deposits.
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On a quarter-on-quarter basis, NIM expanded by 15 basis points as a result of favorable loan repricing and liquidity provided by the proceeds from the bank’s recent stock rights offering.
The recent capital build-up allowed the bank to retire more expensive time deposits. NIM increased from 2.91 percent in the first quarter to 3.06 percent in the second quarter.
