Security Bank net income up 12% year-on-year in September

By on November 7, 2017


MANILA — Robust loan growth boosted Security Bank Corporation’s (Security Bank) net income in end-September 2017 to PHP7.4 billion, up 12 percent year-on-year.

“This result was driven by a 24 percent or PHP2.8 billion increase in net interest income to PHP14.3 billion,” the bank said in a disclosure with the Philippine Stock Exchange (PSE) Monday.

In the third quarter alone, the bank’s net income rose to PHP2.14 billion, up 21 percent year-on-year after  net interest income rose 22 percent to PHP5 billion.

The bank traced the big jump in net interest income to the 38 percent year-on-year increase in loans to PHP370 billion and the 44 percent uptick of deposits to PHP431 billion.

Wholesale loans went up by 36 percent, spearheaded by the 39 percent rise of corporate loans;  followed by the 32 percent increase of those extended to the middle market segment.

Consumer loans, which accounts for 14 percent of total loans, registered a faster growth of 67 percent, the disclosure said.

Net interest margin stayed flat at 3.2 percent but higher than end-2016’s 3.1 percent.

Operating expenses rose 17 percent in line with the increase in staffing for new branches, retail lending and electronic commerce (e-commerce) platform, which resulted in the 22 percent uptick in manpower cost.

The bank opened 19 new branches from October last year up to the third quarter this year, eight of which were opened this year alone.

Upgrade of the bank’s inflation technology (IT) system and expansion of branches boosted software cost, among others, by 40 percent, it said.

Net non-performing loan ratio (NPL) stood at 0.11 percent and NPL reserve cover is at 220 percent.

Total assets went up by 17 percent to PHP796 billion, with shareholders capital up eight percent to PHP103 billion.

Return on average shareholders’ equity (ROE) is at 9.8 percent, return on average assets is 1.5 percent, and common equity Tier 1 ratio is 16.2 percent.

Security Bank’s Capital Adequacy Ratio (CAR), a gauge of a bank’s financial health, is now at 18 percent, higher than regulatory requirements.