Philippine Bank of Communications (PBCom) posted a net income of P496 million in the first quarter of the year, down by 8.4 percent from a year ago due to higher operating expenses.

According to its financial statement posted on the Philippine Stock Exchange, the bank's total operating expenses went up by 16.4 percent to P937 million from P805 million a year ago.

This was mainly due to 'higher manpower costs, volume-driven costs…, higher provision for impairment losses and higher occupancy and other equipment related costs,' the bank said.

Income taxes also increased by P7.7 million in the first quarter due to the higher final taxes on interest income on peso government securities as well as onshore income.

The bank reported a 31.1 percent increase to P2.2 billion in interest income.

However, interest expense surged by 79.8 percent to P1.007 billion due to higher costs of funds amid the high interest rate environment.

Meanwhile, the listed bank booked an eight percent rise in net interest income to P1.27 billion from P1.18 billion in the previous year driven by gains in trading and securities, service charges and commissions as well as higher income from trust operations.

Its net interest margin, however, went down to 4.02 percent in the first three months of the year, from 4.27 percent in the same period in 2023.

PBCom's loans and receivables also declined by 4.2 percent to P87.87 billion in the January to March period from P91.77 billion in the previous year.

The bank's non-performing loan ratio jumped to 3.15 percent in the first quarter from 2.77 percent at end-2023.

On the other hand, the total liabilities of the lender decreased by 3.1 percent to P125.82 billion from P129.82 billion in the comparable year-ago period.

'This resulted mostly from a P8.9 billion decrease in deposit liabilities mainly from time deposits, demand deposits, and savings deposits, and offset by a P5.3 billion increase in bills payable,' the bank said.

PBCom's total assets stood at P143 billion in the first quarter of the year, down by 2.7 percent from P147 billion previously.

The bank's capital adequacy ratio stood at 16.8 percent, well above the 10 percent minimum requirement.

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