China Banking Corporation (Chinabank, PSE: CBC) has reported a record-breaking net income of P11.4 billion for the first half of 2024, marking a 6% increase compared to the same period last year.
In a press statement, the bank shared that its impressive financial performance may be attributed to the strong growth in core lending and deposit-taking activities, combined with stable asset quality and controlled operating expenses.
Chinabank remains one of the top-performing banks in PH
This achievement translated to a return on equity of 15.1% and a return on assets of 1.5%, maintaining its status as one of the top-performing banks in the country.
“Our business performance continued to improve during the first half of the year,” said CBC President and CEO Romeo D. Uyan Jr. “The continued growth of our core lending and deposit-taking businesses, combined with stable asset credit quality and controlled operating costs, allowed us to register our highest first-half net income to date, solidifying our position as one of the top four banks in the country.”
Net interest income surged by 19% year-on-year to P30.4 billion, as higher interest income outpaced the rise in interest expenses. This led to a 25-basis point improvement in the bank’s net interest margin, now standing at 4.4%.
The bank’s credit quality also showed positive trends, with a non-performing loan (NPL) ratio of 1.9%, better than the industry average. CBC’s lower credit provisions, recorded at P737 million, were balanced by a strong NPL coverage ratio of 141%, showcasing prudent risk management practices.
Operating expenses rose by 5% to P14.1 billion, primarily due to increased volume-related taxes. Despite this, the bank managed to slightly improve its cost-to-income ratio to 49%, reflecting efficient cost management.
Chinabank remains the fourth-largest private universal bank in the Philippines, boasting total assets of P1.5 trillion, a 12% increase. The bank’s gross loans expanded by 10% to P817 billion, driven by robust demand across various market segments.
Notably, consumer loans, which make up a quarter of the total loan portfolio, saw a remarkable 25% growth. Meanwhile, deposits grew by 14% to P1.3 trillion, outpacing the industry average.
The bank’s balance sheet strength was further supported by a 10% increase in capital, reaching P152 billion. Chinabank’s Common Equity Tier 1 (CET1)/Tier 1 ratio stood at 14.5%, while its total capital adequacy ratio was at 15.3%, both comfortably above regulatory requirements. The bank also reported a 10% year-on-year increase in book value per share, now at P56.42.
“This solid financial performance, backed by strong capital and liquidity, reflects CBC’s inherent financial strength, prudent risk management, and sharpened customer focus,” stated Chief Finance Officer Patrick D. Cheng.
Photo shows Chinabank Retail Banking Business Segment Co-Heads Jose Osmena Jr. (center) and Clara Sy (right), together with Asian Banking & Finance Publisher and Editor-in-Chief Tim Charlton.
As Chinabank approaches its 104th anniversary on August 16, it continues celebrating significant milestones. The bank was recently honored with the Asian Banking & Finance’s Domestic Retail Bank of the Year (Philippines) award and was included in the inaugural Fortune Southeast Asia 500 list.
Additionally, Chinabank successfully launched a brand refresh program to modernise its image and connect with a new generation of customers.
These achievements underscore Chinabank’s commitment to growth and innovation, as it continues to strengthen its position in the Philippine banking industry. With a solid foundation and a clear strategic vision, the bank is well-positioned to navigate the evolving financial landscape and deliver sustained value to its customers and shareholders.