A reflection of a strengthening economy.
According to the Philippines' central bank, the Phiippines' expanding economy is providing the banking system ample range to grow.
The economy grew by 7.1 percent in the third quarter for a full nine-month growth of 6.5 percent.
It boosted the income growth of the country’s 37 universal and commercial banks to 15 percent year-on-year income growth for the first nine months of the year. Loans, deposits, as well as trading gains continue to prop up profits.
The big banks posted profits of P80.113 billion, up from same period last year of P69.628 billion.
The universal and commercial banks, which control 97 percent of the total banking resources, reported modest net interest income growth of 2.8 percent to P149.239 billion.
The trading gains-driven non-interest income however surged 16 percent year-on-year to P96.88 billion. Trading in treasuries or securities continue to be one of the industry’s main but largely speculative source of revenues.
For the third quarter period, the big banks’ return on equity rate dropped to 12.33 percent from the same time in 2011 of 12.44 percent. Return on assets, in the meantime, rose to 1.58 percent from 1.52 percent.
BSP data also showed that the banks’ cost to income ratio was higher at 63.74 percent from 62.7 percent last year.
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