MANILA—Strong rise of Gutianon-led EastWest Bank’s consumer loans boosted the bank’s net income by 70 percent year-on-year in 2016.
In a disclosure with the Philippine Stock Exchange (PSE) Friday, the bank reported a PHP3.4 billion net income, a big jump compared to the PHP2 billion in 2015.
EastWest President and CEO Antonio Moncupa Jr. said “as previously mentioned, 2016 will show the early results of our expansion program that started in 2012.”
“This puts behind us the worst of the initial pain of the program that brought us to have the seventh largest store network but kept our income flat at PHP2 billion in the previous three years,” he said.
The bank’s consumer loan business, which account for more than 50 percent of total loan portfolio, expanded by 51 percent and fuelled the 25 percent increase in total assets to PHP292 billion.
Total loans went up 29 percent to PHP202 billion.
The bank targeted a 50 percent rise in its 2016 earnings as a result of expansion of its store network to 445 as end-2016, nearly three times within the last five years.
Net revenues went up by 34 percent to PHP22 billion despite the smaller rose of operating expenses at 21 percent to PHP12 billion.
Recurring income rose by 25 percent and net interest margin and loan loss provisioning remain high by industry standards at 7.7 percent and 4.9 percent, respectively.
Total deposits increased by 30 percent to PHP240 billion due to the 38 percent growth of low-cost current and savings accounts.
Moncupa said the bank’s productivity “is improving as the overhead cost related to the expansion of the last three years gain traction.”
“And that is just the start. We expect furtherimprovement in operating leverage and subsequently, better returns to our investors in the coming years,” he added.