BPI Investor Update FY2014

CONFIDENTIAL

Bank of the Philippine IslandsInvestor Update

As of December 31, 2014

Founded in 1851, as Banco Español Filipino de Isabel II, by Catholic charities– Antonio de Ayala inaugural member of board

Named Bank of the Philippine Islands (Banco de las Islas Filipinas) after Treaty of Paris (1898)

Ayala y Compañia (present day Ayala Corp.) assumes strategic stake in 1969

Morgan Guaranty Trust Company (“MGT”)purchases stake in People’s Bank, a predecessor company, in 1974

DBS and GIC, Singapore’s sovereign wealth fund, eventually acquire MGT’s stake (21%)

GIC now has an effective 5.6% holdings via Ayala-DBS Holdings Ltd.

History of BPI

Pesos Fuertes, 1883

BPI Iloilo, 1897

Investor Update YTD December 2014 1

Shareholders & Equity Profile

Fundamentals Description

PCOMP Index 5.37% weight

Stock Price P106.00 per share

BV per share P36.64

P-B Ratio 2.89x

EPS** P4.59

P-E Ratio 22.91x

Dividends P1.80 per share

Dividend Yield 1.81%

Issued Shares 3.932 bn

Market Cap P416.79 bn

Trading Volume P373mm 30d ADTV

** Full Year 2014 EPS

Shareholders


* Roman Catholic Archdiocese of Manila

Ayala Corp, 48.3%

RCAM*, 8.3%

GIC, 5.6%

Public Float, 37.8%

As of April 10, 2015

3

Universal banking

Asset management

Our Unibank Businesses

Deposits, securities dealing, asset mgt

International banking

FX dealing

Corporate finance, advisory, underwriting

Securities brokerage

Thrift banking

Thrift banking

Equipment leasing

Thrift Banking

51%

40%

Remittance

Remittance

Investor Update YTD December 2014

BPI: 163 Years in the Philippines

Branches ATMs/CAMs

Expansive reach in both traditional and electronic channels

~7 million customers

825 branches

2,575 ATMs & CAMs

29,344 POS machines

14,542 employees


International Footprint

Branches

• United Kingdom (2)

• Italy (2)

• Hong Kong (1)

Remittance Centers

• Spain (1)

• Hong Kong (4)

Representative Offices

• Tokyo, Japan

• Dubai, UAE


BPI Industry Standing

(In P Bn)

Assets

Net Loans

As of December 2014

Customer Loans

Deposits

Capital

Trust Assets

BPI Market Size RankMarket Share

1,434

800

802

1,177

140

522

10,850

5,548

5,020

8,151

1,097

2,525

13.2

14.4

16.0

14.4

12.8

20.7

3

3

2

3

3

2

Source: Published Statements of Condition

6Investor Update YTD December 2014

Stable profitability, strong risk culture, well-capitalized

Performance Highlights: As of December 2014

Solid Financial Results

Net income of Php 18.0 bn (US$ 406.3 mn)

ROE at 13.75%, ROA at 1.44%

Steady Income Sources

Net interest income up by 15% YoY

Non interest income, ex securities trading gains, up 11% YoY

Managed Operating Costs

Cost-to-income at 53.7%; industry at 61.2%

Robust Balance Sheet Growth

Net loans grew 27% to Php 800 bn (US$ 18.0 bn)

Deposits at Php 1.2 tn (US$ 26.5 bn), up 19%

Improved Asset Quality

Gross-90 day NPL ratio at 1.5%

Reserve Cover at 109%

1

2

3

4

5

Total Equity of Php 144 bn (US$ 3.2 bn)

CAR: 14.85% (vs BSP minimum requirement of 10%)

CET 1 CAR: 13.97% (vs BSP minimum requirement of 6%)

6 AdequateCapital


27.519.9

30.322.2

34.8

21.0

Revenue Breakdown (P bn)

2012 2013 2014

58% 58%62%

42%

42%38%

2012 2013 2014

Total Revenues (P bn)

Net Interest Income Non Interest Income

14%

11%6%

Full year 2014 revenues at Php 55.8 bn(US$ 1.3 bn)

Net Interest Income at Php 34.8 bn(US$ 783.6 mn), up +15%

- Average Assets up by Php 247 bn(US$5.6 bn), or +25%

Non Interest Income excluding securities trading gains was Php 19.7 bn (US$ 444 mn), up +11%

Revenues


47.4

52.555.8

6% 10%

15%

25% 11% 5%

42% 40% 40%

29% 30%30%

29%30%

30%

2012 2013 2014

Operating Expense (P bn)

24.8

6% 26.7

30.08%

12%

Operating Cost

2.9 2.7 2.4

2012 2013 2014

Cost to Asset (%)

Cost to Asset


52.3 50.9 53.761.7 58.9 61.2

2012 2013 2014

Cost to Income (%)

Mortgage Auto Credit Card Personal

Retail Sector 16%

2013 2014

15%

20% 14%

45%

Credit Book

76%

77%

79%

24%

23%

21%

2012 2013 2014

Loan Portfolio (P bn)

Corporate Loans Retail Loans

822.7

650.0

535.8

15%

27%

21%

Top Tier Middle Market SMEs

Corporate Sector 30%

33%

28%

22%


Asset Quality

67.5 %

82.3 %87.9 %

96.0 %105.2 %

109.3 %

3.8 %3.1 %

2.5 % 2.1 % 1.8 % 1.5 %

2009 2010 2011 2012 2013 2014

Reserve Cover NPL Ratio (Gross 90)

NPL ratio improving notwithstanding robust growth in loan portfolio


Downward trend in NPL ratio; adequate reserve cover

19% 18% 17%

43%51%

52%

39%

31%

31%

2012 2013 2014

Demand Savings Time

23%

18%

802.3 B

988.6 B

1.2 T19%

85.2%86.8%

86.4%

14.8%

13.2%

13.6%

2012 2013 2014

Peso FDCU

23%

802.3 B

988.6 B

1.2 T

18%

19%

Deposits Deposits grew by 19% to Php 1.2 tn (US$ 26.5bn)

Demand deposits +11%; Savings deposits +22%

Time deposits +19%

Low cost float deposits at 69% of total deposits


Deposits Breakdown (P bn) Deposits per Currency (P bn)

Capital Position Full adoption of Basel III in January 2014 Minimum CAR at 10% and CET1 at 6%


97 129 69 95

706

866

564701

13.7

14.8

12.2

13.613.0

14.0

12.212.7

Conso-2013 Conso-2014 Parent-2013 Parent-2014

Qualifying Capital Risk Weighted Assets CAR CET1% %

Credit Ratings

15Investor Update YTD December 2014

Moody’s(Dec 2014)

C-(Baa2)

Baa2/Prime-2

Baa2/Prime-2

Stable

BBB-

BBB-

BBB

BBB

Stable

Baa2 BBB-

Bank Financial Strength Rating

Local Currency Deposits

Foreign Currency Deposits -LT

Outlook

Fitch Ratings(Apr 2015)

Capital Intelligence(Dec 2014)

BPI Credo


CONFIDENTIAL

Thank you.

Investor Update

As of December 31, 2014

BPI Investor Update FY2014

Documents

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