MANILA, Philippines -- Bank of the Philippine Islands (BPI), the country's biggest bank by market capitalization, reported Wednesday an 11 percent increase in net profit in 2007 on higher non-interest income.

BPI, controlled by conglomerate Ayala Corp., said consolidated net profit was P10.0 billion compared to P9.0 billion in 2006.

"Revenue improved by 9.0 percent, tempered by the relatively flat net interest income. Non-interest income increased by 28 percent from substantial gains on the sale of bank and foreclosed assets, pre-tax income of insurance subsidiaries, rental income, and foreign exchange and securities trading gains," BPI said in a statement.

Quarterly results were not immediately available.

BPI's loan portfolio expanded 11 percent and deposit liabilities grew 10 percent.

BPI, which is the third biggest Philippine bank in terms of assets, is aiming for loan growth of 12 percent this year.

"Though 2008 may be more challenging, the economy is expected to stay the course on the strength of resilient domestic demand," BPI said.

The results, which were unaudited, came in after trading hours.

BPI shares closed steady at P62.50 on Wednesday.

Ayala Corp. rose P7.50 or 1.6 percent to P467.50. The Philippine composite index closed up 1.0 percent. By Enrico dela Cruz

($1 = P40.72)