BPI first quarter profit up 4.5% to $65mn

Despite relatively low interest rate environment, the lender was able to surpass last year’s $62.67mn profit.

Bank of the Philippine Islands Monday said its profit grew 4.5 percent in the first quarter of 2011 year-on-year, slower than its double-digit growth in 2010, on lower gains from securities trading and foreign exchange and miscellaneous income.

The country’s most profitable bank, which increased its net income by 33 percent to an industry-high of P11.3 billion ($262.3 million) in 2010, said profit in the first quarter this year amounted to P2.8 billion ($64.99 million), up from P2.7 billion ($62.67 million) year-on-year. The income translated into a return on equity of 14.4 percent and return on assets of 1.5 percent, it added.

“We are happy that our first quarter results for this year surpassed last year’s level considering the relatively low interest rate environment and its impact on the valuation of our securities inventory,” said bank president Aurelio Montinola III.

While the bank increased its lending and deposit businesses, non-interest income fell 9 percent year-on-year, dragged down by lower gains from securities trading and foreign exchange and miscellaneous income.

“Market valuation of government securities inventory had depressed securities trading income,” the bank said.

Net interest income rose 15 percent, as average asset base expanded by 12 percent. It said 60 percent of the increase in asset base was in the relatively higher yielding loans.

View the full story in Manila Standard Today.