The Group raised P100 million in Tier II capital during the year to support asset growth while deposits were used to meet short-term liquidity needs
GAZETTE REPORTER
BBS Bank Limited Group has posted a profit after tax of P38.4 million for the financial year ended 31 December 2024, marking a significant turnaround from a loss of P21.3 million in the previous year.
Managing Director Pedzani Tafa credited the Group’s performance to the bank’s corporate strategy and the collaborative efforts of its board, management and staff.
“This is a demonstration of impactful progress driven by the bank’s corporate strategy,” Tafa said in the bank’s financial results for the period under review.
Stable
The Group’s total assets rose by 8 percent, increasing from P5.2 billion in 2023 to P5.6 billion in 2024. This growth was largely fuelled by a 70 percent surge in unsecured loans.
Meanwhile, the mortgage portfolio and other products remained stable, showcasing the effectiveness of the bank’s strategy to diversify its loan book. BBS’s deposit base grew by 6 percent during the year, from P4.2 billion to P4.5 billion.
“This is due to continued support from our retail and corporate customers,” Tafa said, noting that growing current and savings accounts will remain a focus area in 2025 to expand the deposit base and manage funding costs.
Notable improvement
Borrowings, including debentures and amounts due to other banks, increased by 37 percent – rising from P373.4 million to P510.2 million. The Group successfully raised P100 million in Tier II capital during the year to support asset growth while deposits were used to meet short-term liquidity needs.
Shareholder equity rose by 7 percent, from P484.1 million to P522.5 million. This was driven by a notable improvement in accumulated earnings, which climbed from a negative P3.4 million to a positive P35.0 million.
Significant growth
Net Interest Income (NII) surged by 68 percent year-on-year, rising from P123.0 million to P206.4 million. “This was largely driven by significant growth in the loan portfolio, particularly the unsecured book, which contributed P154.6 million in interest income,” said Tafa.
However, interest expense also increased by 9 percent – from P246.4 million to P269.6 million – reflecting the expanded deposit base. Still, Tafa said the Group’s net interest position remained strong.
Other income more than tripled to P16.7 million, mainly due to profits from the disposal of properties previously owned by the bank. Net fee and commission income dropped by 14 percent to P37.8 million due to a decline in insurance commissions.
One-off exit costs
Credit impairments increased to P19.1 million, largely from the unsecured loan segment, while other impairments rose to P7.9 million due to higher allowances on Properties in Possession.
Operating expenses (excluding impairments) rose 4 percent to P80.8 million. Personnel expenses declined from P101.1 million to P93.1 million due to one-off exit costs in the previous year.
Tafa said the bank continued to improve key prudential metrics, including its cost-to-income and capital adequacy ratios.