China Banking Corporation (China Bank, PSE stock symbol: CHIB) reported a net income
of P14.7 billion in the first nine months of 2022, up 31% year-on-year, on higher top line
revenues and core fee income. This translated to an improved return on equity and return
on assets of 15.6% and 1.6%, respectively.
Due to rounding, numbers presented in the tables may not add up precisely to the totals provided
and percentages may not precisely reflect the absolute figures.
Net interest income rose 17% to P33.7 billion from higher volume of earning assets,
offsetting the higher interest expense amid a rising interest rate environment. Net interest
margin was maintained at 4.2%.
INCOME STATEMENTS
In Php billions, except %
9M2021 9M2022 YoY Growth
Interest income 34.3 40.6 18%
Interest expense (5.6) (6.8) 23%
Net interest income 28.8 33.7 17%
Fee-based income 7.8 8.3 6 %
Total revenue 36.6 42.0 15%
Operating expenses (16.6) (18.0) 8 %
Income before provisions and taxes 19.9 24.0 20%
Provision for impairment and credit losses (6.5) (6.9) 7 %
Income before income tax 13.4 17.1 27%
Provision for income tax (2.3) (2.4) 5 %
Net income 11.2 14.7 31%
Return on Equity 13.6% 15.6%
Return on Assets 1.5% 1.6%
Net interest margin 4.2% 4.2%
Cost-to-income ratio 45% 43%
2 of 3
Fee-based income grew 6% to P8.3 billion supported by the continued recovery in core
revenue streams, including service charges, fees and commissions, income from the sale
of acquired assets, and bancassurance.
Operating expenses increased by 8% partly due to persistent inflation and a weakening
peso which further pushed up transaction-related costs and technology spend.
Nevertheless, China Bank improved its efficiency with a cost-to-income ratio of 43%.
Even as gross non-performing loans (NPL) ratio eased to 2% from 3.4%, China Bank
hiked its credit provisions by 7% to P6.9 billion for an NPL coverage of 161%, well above
the industry average.
Total assets reached P1.3 trillion, up 21%, on the back of continuous build-up in earning
assets.

Due to rounding, numbers presented in the tables may not add up precisely to the totals provided
and percentages may not precisely reflect the absolute figures.
BALANCE SHEETS
in Php billions, except %
Sep-21 Sep-22
YoY
Growth
Liquid Assets 195 168 -14%
Investment Securities 232 391 68%
Net Loans 592 676 14%
Other Assets 36 40 10%
Total Assets 1,055 1,274 21%
Deposits 849 1,001 18%
CASA 529 582 10%
Time Deposits 321 420 31%
Bills and Bonds Payable 7 0 115 64%
Other Liabilities 22 25 15%
Total Liabilities 941 1,142 21%
Total Equity 114 133 16%
Total Liabilities and Equities 1,055 1,274 21%
NPL Ratio 3.4% 2.0%
NPL Cover 106% 161%
Tier 1/CET 1 Ratio 14.4% 14.9%
Capital Adequacy Ratio (CAR) 15.3% 15.7%
3 of 3
Stronger demand for corporate and consumer loans led to a 14% increase in gross loans
to P697 billion.
“While there is continuous demand for loans, growth for the 3
rd quarter has been more
measured in the light of current macroeconomic conditions,” said China Bank Chief
Finance Officer Patrick D. Cheng.
On the funding side, deposits breached the trillion-mark, increasing by 18%, driven by
sustained CASA (current and savings accounts) growth of 10%.
Total capital funds expanded 16% to P133 billion, for a common equity tier 1 (CET1) ratio
of 14.9% and a total capital adequacy ratio (CAR) of 15.7%.
“This performance demonstrates our strong business franchise and focused growth
strategy. We will continue to efficiently use our resources to fuel the Bank’s growth,
support our customers, and further drive economic recovery,” said China Bank President
William C. Whang.

China Bank was recently recognized by the Chartered Financial Analyst (CFA) Society of
the Philippines for providing the best risk-based returns on a consistent basis over a fiveyear period. China Bank Dollar Fund, for the sixth time since 2016, and China Bank
Intermediate Fixed-Income Fund, for the first time, won CFA’s Best Managed Fund of the
Year awards in their respective categories.
Meanwhile, China Bank Easy Tax Filing and Payment Solution (Easy Tax) won as the
Best RegTech Solution at the Pay360 Awards of UK-based The Payment Association,
the largest community in payments. Easy Tax, the first and only automated collection
facility in the country specifically for real estate developers, was also recognized by Hong
Kong-based magazine Asian Banking and Finance as the Best Digital Business Banking
Initiative for Corporate Customers, along with China Bank Direct Debit Arrangement.