Banks' profits up amid trading gain contraction

The banking industry continued to be profitable in 2007 despite contractions in trading gains and trust department income, the Bangko Sentral ng Pilipinas (BSP) said in its Philippine Financial System report. Net income of banks grew 9.5 percent to P62.9 billion in 2007 from P57.4 billion in 2006, the report noted. Banks' total operating income reached P267 billion, made up mostly of net interest income of P168.1 billion from loans and foreign exchange services. Operating expenses reached P206.5 billion resulting in a net operating income of P60.5 billion. Low interest rates encouraged banks to be aggressive in consumer lending, especially targeting overseas Filipino workers for housing loans. Bank deposits rose to P3.664 trillion from P3.497 trillion. Meanwhile, the capital position grew modestly by 5.8 percent to P601.8 billion due to the implementation of stricter capital standards under Basel 2.

in Manila Times by Maricel E. Burgonio
May 02, 2008
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