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DBP net income down at end-September

The Development Bank of the Philippines (DBP) saw its net profit drop by almost a third in the nine months to September, amid heightened loan loss provisions during the pandemic.

The state-lender’s net profit stood at P3.24 billion as of September, declining by 26.69% from the P4.42 billion logged in the same period of 2019, it said in a statement on Friday.

DBP Executive Vice President for Corporate Services and Concurrent Head of Operations Marietta M. Fondevilla said the lower income was mainly caused by higher provisioning for credit losses and income taxes.

The bank also saw increased administrative expenses by its field units for their pandemic response, she added.

Meanwhile, the lender’s credit portfolio grew as loans jumped 13.91% to P374.85 billion in the nine months ended September from P329.07 billion a year ago.

“DBP broadened its support to priority industries as we throw our full commitment to rebuild, recover and revitalize the economy that has been battered by the pandemic and the series of calamities,” DBP President and Chief Executive Officer Emmanuel G. Herbosa said in a statement.

Broken down, nearly half (46%) or P175.72 billion of the loans disbursed went into infrastructure and logistics projects. Meanwhile, P77.23 billion went to social services, P43.12 billion went to environment projects, and P26.48 billion went to micro, small and medium-sized enterprises.

The lender’s total deposits also climbed 50% to P754.95 billion as of September, backed by the 58% surge in term deposits and the 22% rise in low-cost deposits.

DBP’s assets rose 38.89% to P945.39 billion at end-September from P700.86 billion a year ago. The bank’s net worth was at P64.01 billion.

Total capital likewise inched up P9.49% to P64.01 billion from P58.56 billion. Mr. Herbosa said this was boosted by the P6-billion infusion from the national government under Republic Act No. 11494 or the Bayanihan to Recover as One Act.

Its capital adequacy ratio stood at 13.76%, higher than the industry average of 12.39% and also beyond the minimum regulatory requirement of 10%.

“While DBP’s fiscal position remains strong and we are confident of reaching our full-year financial targets, the bank’s focus is to optimally mobilize our available resources not just for recovery but also towards improving the resiliency of our priority sectors against future economic shocks,” Ms. Fondevilla said. — L.W.T. Noble

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