China Banking Corp. posted another solid quarter, with first-half earnings rising 11 percent as robust loan growth, stronger interest income and healthier asset quality offset higher operating expenses.
The Sy Group-controlled lender reported net income of P14.5 billion for the first six months of 2026, underscoring how sustained credit demand continues to power the banking sector despite elevated inflation and lingering global uncertainties.
The results reinforce a broader trend among Philippine banks this year. Lending remains the principal earnings engine, while improving loan quality has allowed banks to trim provisions and preserve profitability.
Net interest income, the bank’s largest revenue source, climbed 14 percent to P39.7 billion as net interest margin widened to 4.67 percent, reflecting stronger returns from its expanding loan portfolio.
Gross loans grew 17 percent to P1.1 trillion, driven by healthy demand from both corporate and consumer borrowers, while deposits increased 14 percent to P1.5 trillion.
A bright spot was the 20 percent jump in low-cost checking and savings account deposits, which lifted the bank’s CASA ratio to 49 percent and helped contain funding costs despite the higher-interest-rate environment.
China Bank’s balance sheet also continued to strengthen. Total assets rose 13 percent to P1.9 trillion, keeping it the country’s fourth-largest private universal bank, while shareholders’ equity increased 11 percent to P192 billion.
At the same time, credit quality improved further. The bank’s non-performing loan ratio eased to just 1.5 percent, allowing it to recognize only P1.2 billion in impairment provisions while maintaining a healthy 106 percent loan-loss coverage ratio.
Operating expenses rose 11 percent to P18.4 billion as the bank continued investing in business expansion, although its cost-to-income ratio remained manageable at 50 percent.
China Bank ended June with a capital adequacy ratio of 15.6 percent and a common equity tier 1 ratio of 14.7 percent, providing ample capital to support future lending.
The results suggest China Bank is benefiting from a favorable mix of expanding credit demand, disciplined risk management and a growing base of low-cost deposits, positioning it to sustain earnings momentum even as the operating environment remains challenging.
