Security Bank earnings soar 54% to P6.4 B

MANILA, Philippines - Security Banking Corp. has reported a 54-percent growth in its net income in the first nine months this year compared to the same period in 2013.

From earnings of P4.2 billion from January to September 2013, it ballooned to P6.428 billion this year.

In the third quarter alone, net earnings reached P2.8 billion, up 13 percent year-on-year.

Security Bank president and chief executive officer Alberto S. Villarosa said all of the bank’s business segments sustained strong results in the third quarter.

“They continue to deliver healthy returns on our investment in branch network expansion in 2012-2013,” Villarosa said.

The bank’s net interest income increased 37 percent to P8.5 billion as the its core businesses registered strong positive growth.

Core revenues – comprising of net interest income, fee-based income, and trading gain attributable to customer flows – grew 27 percent to P10.2 billion. Fee-based income, inclusive of asset management, was at P1.2 billion, while overall trading gain amounted to P3.6 billion.

The bank’s loan portfolio increased 25 percent year-on-year to P181 billion and deposits went up 26 percent to P232 billion. The loan-to-deposit ratio was at 78 percent.

Total assets were valued at P366 billion as of Sept. 30, or 33 percent higher than the year-ago level.

Total operating income increased 41-percent year-on-year to P13.5 billion. Operating expense growth (excluding provision for probable credit losses and impairments) stood at 13 percent. Security Bank’s net non-performing loan (NPL) ratio was at 0.21 percent as of September this year compared to 0.16 percent a year ago.

Not with standing the strong asset quality, provision for probable credit losses for the first nine months of 2014 was set at P784 million. The NPL reserve cover increased to 212 percent in the first nine months of 2014, compared to 193 percent in the same period last year.

Basel III-compliant Common Equity Tier 1 (CET 1) increased to 14.3 percent.

Total capital adequacy ratio (CAR) increased to 18.5 percent from 14 percent a quarter ago after the bank issued P10 billion in Basel III-compliant Tier 2 notes in the middle of the year.

The bank operates a network of 254 branches and 468 ATMs as end September.

In 2013, full year net income reached P5 billion, compared to its all-time high profit in 2012 that reached to P7.5 billion.

Security Bank’s board approved last month the integration of 39 branches of thrift bank subsidiary Security Bank Savings into parent Security Bank to streamline the retail bank focus and widen the product scope of these branches.

It likewise approved the banc assurance agreement with FWD Life Insurance Corp. FWD – the insurance arm of Pacific Century Group led by Hong Kong-based businessman Richard Li – which is a high-growth, technology driven insurance company focused on the Asian region.