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Consumer loans push lender interest income higher




Despite consumer loans performing less than optimal across the Philippine banking industry, EastWest Bank (EW) remains the most consumer-focused universal bank in the country after it posted a net interest income (NII) of P19.3 billion in 2018, up from P18.5 billion in 2017.

The NII is the revenue generated by interest earned from assets. On this front, EW saw a remarkable growth of 16 percent in its auto, credit card and personal loans portfolio in 2018, contributing to the growth of NII. Consumer loans make up 70 percent of EW’s total loans.

EW is one of the largest universal banks in the Philippines today.

EW also posted a net interest margin of 7.4 percent — an indicator of the bank’s returns on its assets — which is the highest among universal banks.

Provisions for loan losses also went down by 16 percent from the previous year to P3.9 billion as much of the bank’s consumer loan portfolio has matured.

These factors allowed the bank to offset generally lower interest margins and absorption of higher interest costs due to tight competition for market share.

This growth in its consumer loans portfolio helped EW sustain a net income of P4.5 billion in 2018 registering a return on equity of 11 percent, allowing it to remain one of the most profitable banks in the Philippines.

EW is one of the largest universal banks in the Philippines today. It caters to the financial needs of consumers, middle market corporates and the mass affluent.

Since 2012, EastWest has been trading under the symbol “EW” in the Philippine Stock Exchange, allowing the public to participate in our success. EastWest is a subsidiary of Filinvest Development Corporation, one of the country’s leading conglomerates with a diverse range of interests from real estate, banking, sugar, hospitality/tourism to power generation.