PSBank profit jumps 63% to P533 in H1

Philippine Savings Bank (PSBank) reported a 63-percent increase in net income in the first semester of 2006 to P533 million from P327 million in the same period in 2005.

Last year, the thrift banking arm of the Metrobank group posted net earnings of P646 million, or 30 percent better than the P497 million in 2004.

Total assets grew by eight percent while loans grew to P30 billion. Deposits expanded to P47 billion while total capital hit P5.7 billion.

"With the Tier 2 issuance and rights offer, PSBank’s capital adequacy ratio (CAR) increased to 19.4 percent in June 2006. This is one of the highest in the thrift banking industry and prepares the bank for the implementation of the Basel II accord next year. Its return on equity (ROE) ratio was 20 percent, or an improvement from the 13.1 percent posted last year," Perfecto Ramon Dimayuga Jr., PSBank chief finance officer, said in a statement.

New regulations under the international accounting standards (IAS) this year, and the Basel II next year, will require huge capital build-ups for the banking system. It is expected to result in several bank downgrading its status, reducing its products and services, and consolidations through mergers and acquisitions (M&A).

"Being prepared allows us the flexibility and prepares us for whatever opportunity comes with the full implementation of Basel II," Pascual M. Garcia III, PSBank president, said in an earlier interview.

The country’s second biggest thrift bank raised P2 billion early this year from a Tier 2 unsecured subordinated debt offer with a 10-year tenure. It also raised at least P750 million from a rights offer in the first semester.

It has 150 branches with another 13 to be opened within the year. It also has 147 automated teller machines (ATMs) and will put up 53 new ATMs by the end of 2006.