BDO maintains positive outlook for 2025

BDO Unibank Inc. remains upbeat about its performance prospects for 2025 despite headwinds from global economic uncertainties, expressing confidence in the resilience of the Philippine economy to support sustained growth.

BDO President and Chief Executive Officer Nestor Tan said during a briefing on Friday that the bank’s strong start in the first quarter—marked by a net income of PHP19.7 billion, an increase from PHP18.5 billion in the same period last year—was driven by its core businesses. Lending activities continued to lead the bank’s growth, with total customer loans increasing by 12 percent year-on-year to PHP3.3 trillion.

Tan noted that growth was recorded across all lending segments—consumer, middle market, and large corporates, with consumer loans particularly bolstered by demand in the real estate and motor vehicle sectors. He said that the expansion of the bank’s balance sheet is largely supported by loan activity and partially funded by deposits, which grew by 6 percent to PHP3.8 trillion.

Although low-cost current and savings account (CASA) deposits are increasing, Tan acknowledged that the bank still has some way to go before fully recovering to pre-pandemic levels. He emphasized that expanding the bank’s footprint will help address this challenge. “We still have a long time to go before we reach the pre-pandemic levels,” he said.

BDO is aggressively pursuing network expansion, having opened 71 new branches last year and targeting up to 120 new branches nationwide this year. According to Tan, the bank now operates around 18,000 branches across the country, a number that significantly supports efforts to reach unbanked and underserved areas.

Despite a 12 percent increase in operating expenses during the first three months of the year, BDO saw an improvement in asset quality. The bank’s non-performing loan (NPL) ratio dropped to 1.77 percent, while NPL coverage rose to 143 percent, signaling more robust risk management.

Tan also shared his outlook on monetary policy, predicting that the Bangko Sentral ng Pilipinas (BSP) might implement two additional interest rate cuts before the year ends, amounting to a total reduction of 50 basis points. “We expect a little bit of monetary easing… We expect some more (cuts) before the end of the year,” he said.

Earlier this year, the BSP lowered key interest rates by 25 basis points during the Monetary Board’s policy meeting on April 10. The Target Reverse Repurchase Rate now stands at 5.5 percent, with the overnight deposit and lending rates at 5 percent and 6 percent, respectively.