Banco De Oro Unibank, Inc (BDO) announced that 1Q08 net income attributable to parent company shareholders registered at P1.34 billion, a decrease of 24% from P1.77 billion in 1Q07. This arose as higher net interest income and non-trading income was overshadowed by weak trading gains due to a difficult operating environment.

Net Interest Income inched up 6% to P5.4 billion given a better loan and deposit mix. Gross customer loans grew 18% compared to the same period last year, and 7% compared to December 2007, due to a broad-based increase in all lending segments. Total Deposits likewise expanded 4% year-to-date to P463.8 billion, driven by the robust growth in low-cost deposits amid a reduced reliance on high cost funding. The higher asset yields and improved funding mix contributed to the expansion in net interest margin which settled at 4.02% in 1Q08 from 3.80% in 1Q07.

Non-Interest Income fell 15% to P3.7 billion due to a 53% drop in trading and forex gains while fee-based and miscellaneous income combined grew 7% to P3.0 billion aided by strong growth in volume and a one-time gain on Visa shares from its IPO.

Operating costs decreased 3% to P6.3 billion despite expenses related to the ongoing integration program as the previous year’s level included the settlement of prior years’ tax assessments. Impairment provisions rose 39% to P870 million due to more conservative provisioning policies.