The Lucio Tan-led Philippine National Bank (PNB) announced on Monday that its earnings doubled last year on the back of the gains in its core business and higher operating efficiencies.

In a statement, the lender said its 2009 unaudited net income surged to P2.2 billion from P1.1 billion the previous year as its net interest margin rose by 18 percent to P7.8 billion from P6.6 billion previously.

The expansion in the bank’s lending business led to an 11-percent growth in interest income, while the improved funding mix caused its interest expense to inch up by only 1 percent, PNB said. 

Loans and receivables climbed by 14 percent as consumer loans expanded through promotional campaigns and active cross-selling of auto, housing and multi-purpose loans by the branches. Deposits also went up 7 percent to P215 billion.

PNB said it sold P3.25-billion worth of five-year Long-Term Negotiable Certificates of Deposits in March 2009. Medium-term dollar and peso time deposits and renminbi savings and time deposits were also launched during the year.   

Trading and investment in securities earned the bank P1.4 billion in net gains following the recovery in the mark-to-market valuation of securities held for investment.

Miscellaneous income improved by 22 percent to P1.9 billion mainly because of the higher profits made from the sale of foreclosed properties, which resulted in a 23-percent increase in total operating income.

PNB said the ratio of operating expenses to total operating income improved despite the increased business requirements.

The bank’s non-performing loans cover rose to 88 percent from 82 percent a year earlier, while its bad loans ratio slid to 5.9 percent from 8.5 percent previously.  

Its consolidated resources stood at P284.5 billion, reflecting a 3-percent annual growth. 

The bank’s other assets include a P2.8-billion equity investment in Allied Commercial Bank in Xiamen, China.

PNB’s capital adequacy ratio improved to 19 percent, well above the Bangko Sentral ng Pilipinas’ minimum of 10 percent. 

Lailany P. Gomez