Showing strength and resilience in 2016, the Philippine economy performed even better in 2017. Real gross domestic product grew by 6.7 percent this year, powered by rising exports and strong domestic consumption and public sector investments. Although this year's performance was slightly lower than the 6.8 percent of the previous year, this marked the sixth consecutive year that the GDP grew by more than 6 percent annually, thus making the Philippine one of the fastest growing economies in Asia.

The full-year average inflation rate for 2017 held steady at 3.2 percent, within the target set by the BSP. The full-year average of 3.2 percent was higher than the 1.8 percent inflation rate in 2016 due mainly to higher international crude oil prices and was the highest since inflation average of 4.1 percent in 2014. The peso had depreciated by more than 4 percent during the year to hit an eleven year low of P51.77 to $1 in mid-October, but rallied toward the end of the year to close at P49.93, a slight 0.42 percent lower from 2016's closing of P49.72. The Philippine Stock market closed the year at an all-time high of 8,558, gaining 25.1 percent over the previous year's close of 6,840.


Against this background, your Bank's financial condition continue to remain strong. Total resources of the Bank remained at the same level as the previous year, standing at P1.315 billion. Deposits decreased slightly, from P626.1 million to P600.2 million, a drop of 4.1 percent. As was initially felt already last year, our loan portfolio continued to grow substantially, rising to P344.1 million from P185.8 million due to our move into auto financing. Consequently, our investment in loan receivables arising from repurchase agreement adjusted to P271.0 million by year-end 2017 from P443.9 million in 2016. Held to maturity investments stood at P541.4 million, the same level as the previous year.

We are pleased to report that the Bank posted a net income of P15.2 million, a 660.0 percent improvement over the previous year's income of P2.0 million. This was the second highest income generated by the bank since its conversion to a savings bank twenty one years ago. This rise in income was attributable to an increase in Net Interest Income by P21.1 million (44.7 percent). Income from Loans, due primarily to auto loans, jumped from P16.1 million in 2016 to P37.6 million in 2017, a 133.5 percent improvement. Income from Held-to-maturity investments and repurchase agreement also increased by P4.6 million (22.6 percent) and P4.4 million (62.8 percent), respectively.