MANILA, Philippines — A sharp drop in trading gains and higher expenses as well as income tax payments slashed the earnings of Security Bank Corp. by 16.5 percent to P8.6 billion this year from a record P10.3 billion in 2017.
The bank’s trading gains plunged by 85 percent or P2 billion and the increase in provision for income tax jumped 47 percent or P790 million.
Security Bank’s net interest income from customer loans and deposits jumped 30 percent or P3.6 billion to P15.7 billion, driven by the continued expansion of consumer loans and low-cost deposits.
Total loans went up 12 percent to P416 billion as consumer loans surged by 47 percent, while wholesale loan grew seven percent.
Total deposits expanded by 18 percent to P489 billion.
The bank’s interest margins continued to improve as net interest spread on loans and deposits further increased to 4.72 percent in the fourth quarter.
Interest income from financial investments fell 11 percent or P1.2 billion mainly due to a lower level of investment securities at amortized cost.
Total net interest income grew seven percent to P20.8 billion. Overall, net interest margin further improved to 3.4 percent in the fourth quarter.
Service charges, fees and commissions rose 26 percent to P2.9 billion, driven by credit card, bancassurance, loan fees and deposit charges.
Asset quality remained healthy, with gross non-performing loan (NPL) ratio at 0.7 percent, while provision for credit losses reached P714 million and NPL reserve cover was 112 percent.
Security Bank continues to be among the country’s best capitalized private domestic universal banks. Common Equity Tier 1 Ratio increased to 16.4 percent from 15.5 percent a year ago.
Total capital adequacy ratio likewise improved to 18.7 percent from 17.7 percent.
The return on shareholders’ equity was 8.1 percent. Shareholders’ capital increased four percent to P109 billion.
The bank’s total assets grew by 10 percent to P767 billion. Security Bank has a total of 305 branches and 760 ATMs.