News Release

Re: Branch Network Update

Contact:
Roland Avante

Dave Sison

Avante_rr@pbb.com.ph

Sison_jdd@pbb.com.ph

+632-363-3333 local 5001 +632-363-3333 local 4017

Tuesday, December 2, 2014

PHILIPPINE BUSINESS BANK BRANCH NETWORK TO REACH 115 BRANCHES BY YEAREND
Branch network expansion continues

Current network of 110 branches

Expected to add five more before 2014 ends

Delays due to difficulty of selecting attractive sites, inclement weather, and construction delays

Original target of 126 by end-2014 moved to 1H2015; end-2015 target of 140

Strong bank-wide loan growth partially a result of branch network expansion

Caloocan City, Philippines Philippine Business Bank (PSE:PBB) expects to end the year with 115 branches,
15% higher year-over-year (YoY) from end-2013s total of 100 branches. PBB currently operates 110
branches.
The branch expansion has proven its merit given the strong growth of the loan and deposit business of
the bank. The branch network expansion program has been met with delays due to difficulties in selecting
attractive sites, coupled with the inclement weather which caused some construction delays in sites already
chosen, said PBB President and Chief Executive Officer Roland Avante.
Dave Sison, Head of Corporate Planning and Investor Relations Officer added, While we will be ending the
year with fewer additional branches versus our target of 20 to 25 new branches a year, we will not sacrifice
the banks long-term business just for the sake of meeting short-term numbers.
Despite headwinds in the branch expansion initiative, senior management believes the growth in the banks
core business is satisfactory and that the doubling of branches from 55 in end-2010 to the current 110 has
already demonstrated its value. Loan generation from the branches has considerably picked up, from under
5.0 billion in 2012 to almost 14.0 billion today.
I am confident that the branch expansion will continue to be a principal foundation of the banks sustained
success and profitability. The business case for the expansion has been established and challenges will not
deter us from reaching our goals.

We will continue with the branch expansion as this is central to the banks vision of partnering with the
small and medium-sized enterprises located throughout the archipelago. We see dynamism in leading
business centers outside the capital, and there are also up-and-coming provinces which have a lot of
potential, said Mr. Avante.
PBB deliberately focused on the expansion of its branches in the countryside while moving the construction
of branches in restricted areas to 2015. A projected eight (8) restricted branches are scheduled to be opened
next year. The bank expects to reach 200 to 250 branches over the medium term.
For the first nine months of the year, PBBs pre-tax pre-provision profit was lower by 43.3% at 674.2
million and net income was lower by 52.0%, as the branch expansion and the uncertain trading environment
caused a decline in earnings. However, interest income was up 30.2% from 1.60 billion to 2.08 billion,
driven by loan growth. Loans increased 12.2% to 35.7 billion from 31.8 billion at the end of 2013. Interest
expenses expanded by 59.9 million to 431.0 million, up 16.1% over the same period last year. Deposit
liabilities increased 5.1 billion or 13.5% from end-2013. As a result, net interest income expanded 34.5%
to 1.7 billion from last years 1.2 billion, an increase of 531.2 million.
The strength of the banks core business underscores the banks strategic positioning to reinvigorate its
lending and deposit-taking business. Core income net of operating expenses grew 112.0% or 372.3
million YoY, as the Bank continued to strengthen its position in the SME financing space.