AfE 2024
BDO Unibank, the Philippines’ largest bank, turned in an exceptional financial performance in 2023, cementing its position as the country’s best bank.
The bank achieved a record net income of $1.3 billion, marking a 29% increase from the previous year, with a return on common equity climbing to 15.2% from 13%.
Net interest income surged by 25% year on year, driven by a strong net interest margin of 4.65%, up from 4.15% in 2022. Non-interest income also saw a robust 17% growth. Moreover, the bank’s cost-to-income ratio improved from 59.4% to 58.0%, demonstrating enhanced operational efficiency. The market responded positively to the bank’s performance, as evidenced by a 24% increase in its market capitalization over the past year.
BDO Unibank’s balance sheet remained robust. Gross customer loans grew by 9% while deposits expanded by 11%. Despite rising interest rates, asset quality improved, with the non-performing loan (NPL) ratio decreasing to 1.85% and NPL coverage rising to 185%.
The bank has demonstrated the strengths of the hybrid growth model. In 2023, it opened 70 new branches, primarily in rural and provincial areas, aligning with its strategy to serve underbanked communities. In tandem, BDO Unibank accelerated its digital transformation, enhancing its online account opening process with virtual know-your-customer checks and biometric recognition on self-service machines. These initiatives significantly streamlined transactions, resulting in over 90% of new accounts being opened digitally.