BDO projects a net income of ₱53.9 billion for the first nine months of 2023

Capital continues to strengthen with 13% increase in Book Value 

In the third quarter of 2023, BDO Unibank, Inc. (BDO) recorded a net income of ₱53.9  billion, up from P40.0 billion in the third quarter of 2022. This increase was driven by broad-based development across its key operations. Due to this, the Return on Common Equity (ROCE) increased to 15.1% from 12.4% in the same time last year.

Customer Loans climbed 7.5% year over year to P2.7 trillion and Deposits increased 12% to ₱3.4 trillion, bringing Net Interest Income to an increase of P176.4 billion.

With help from a number of fee-based and treasury/FX businesses, non-interest income reached a final value of 57.9 billion.

With sales growth still outpacing expense growth, pre-provision operating profit reached an amount of ₱ 80.6 billion.

Non-Performing Loan (NPL) ratio remained stable at 1.99% despite the higher interest rate environment, while NPL coverage improved to 176%. The Bank continues to set aside provisions in line with its conservative credit and provisioning policies.

Common Equity increased to ₱494.3 billion given continued profitable operations. Book Value Per Share (BVPS) increased 13% to ₱93.83. Capital Adequacy Ratio and Common Equity Tier 1 (CET1) Ratio strengthened to 15.6% and 14.5%, respectively, with ample capital buffers vs. regulatory minimum levels. 

While macroeconomic challenges persist, the Bank remains cautiously optimistic and is well-positioned to capitalize on opportunities given its strong balance sheet and diversified business franchise. 

BDO and Top Asian banks have issued a new report on climate initiatives

BDO Unibank Inc. (BDO), in collaboration with other prominent Asian banks, has produced the Asia Transition Finance Annual Report 2023 to assist Asian economies in making a "just and orderly transition" to a more sustainable future.

BDO is a member of The Asian Transition Finance (ATF) Study Group, a private-led project with a core of Asian-based banks. The ATF Study Group was formed in recognition of the critical role that transition finance (TF) will play in assisting Asian nations as they move toward net-zero emissions. Its purpose is to develop practical recommendations to enhance current frameworks, such as worldwide standards and taxonomies, when financial institutions (FIs) review and evaluate TF instances.

In 2022, the ATF Study Group published the ATF Guidelines to provide transition finance practitioners with a practical guide to assess transition projects. The Study Group simultaneously published the ATF SG Activity Report to share the challenges and suggested support measures to accelerate transition finance in Asia. These outcomes were introduced at the Asian Green Growth Partnership Ministerial Meetings (AGGPM) in September 2022.

This year, the ATF SG Annual Report 2023 was created after months of discussion among the core members, composed primarily of commercial banks. Development banks, export credit agencies, public agencies, finance associations, and SPOs joined as observers and knowledge contributors. Energy and industry players also participated as guest speakers to share their perspectives.

The ATF Annual Report 2023 describes certain advancements in the seven support measures suggested in the ATF Annual Report 2022 since its release last year. This year’s Study Group mentions more granular enablers needed to accelerate transition finance. The Study Group considers that making progress in these would merit a coherent collaboration among all stakeholders, especially public authorities, TF receivers, and FIs.

As a founding core member of the ATF Study Group since 2021, BDO believes that its sustainability journey, along with other Asian financial institutions, will be more gradual in pace compared to counterpart banks in Europe and the United States. But in collaborating with others, the Bank welcomes the opportunity to bring everyone in the same direction and better manage the energy transition for Asian nations.

BDO will continue to expand its Sustainable Finance initiatives, in place since 2010, towards funding new and existing renewable energy projects to increase their capacity and support the country’s avoidance of greenhouse gas (GHG) emissions.

The Study Group will continue with more focus on collaboration with public authorities and TF receivers to deliver FI’s views on enablers that are supported by experiences as TF practitioners, as well as on peer learnings to bring deeper understanding and practical knowledge about various transition finance guidelines, countries’ policies including national taxonomies, and the development of TFFs by FIs.

The Asia Transition Finance Annual Report 2023 is available at

 https://urldefense.com/v3/__https:/www.enecho.meti.go.jp/category/others/aggpm/ATFSG_Annual_Report_2023.pdf__;!!EIXh2HjOrYMV!YRHnQjMW8Osxj7wLFxP16KMus35eDABP7ypBNXh8PaUKx24tb_gSkqPsZJQ-nLZdPbMjh8HCxAthvvJun16JYAtFNlwU5Q0$ .

BDO declares Cash & Stock Dividends

At its meeting held on December 3, 2022, the Board of Directors of BDO Unibank, Inc. (BDO) approved the declaration of regular cash dividends on common shares in the amount of P0.30 per share for the 4th quarter of 2022, payable on December 29, 2022 to all stockholders on record as of December 20, 2022. 

The Bank likewise received approval from the Securities & Exchange Commission (SEC) on Nov. 29, 2022 for its stock dividends equivalent to 20% of current outstanding. To recall, BDO’s Board of Directors approved on March 26, 2022: the declaration of 20% stock dividends; an increase in its authorized capital stock (common shares) from 5.5 billion to 8.5 billion shares, and; the amendment to the Bank’s Articles of Incorporation to reflect the increase. These were subsequently approved by stockholders at the Bank’s Annual Shareholders’ Meeting held on April 22, 2022, and by the Bangko Sentral ng Pilipinas (BSP) on September 15, 2022. The record date for the stock dividends has been set for December 15, 2022, with payment date set for December 29, 2022.

The P0.30 cash dividend will also apply to the additional shares arising from the 20% stock dividend declaration. 

The cash and stock dividend declarations reflect BDO’s commitment to provide consistent, steady returns and value to its shareholders, while at the same time, continue to invest in its business. The hike in authorized capital stock provides flexibility to increase capital if needed during periods of rapid growth or should attractive opportunities arise. This will allow BDO to continue to expand its business, strengthen its franchise, and deliver quality earnings for long-term sustainable growth. Note that BDO’s ability to expand its business is dependent on business conditions and its financial position.