RCBC nets P4.5 billion in H1

MANILA, Philippines — Rizal Commercial Banking Corp. (RCBC) posted a 26.8-percent decline in net income to P4.45 billion in the first half from P6.22 billion in the same period last year due to higher tax expenses.

The Yuchengco-led bank’s tax expenses ballooned to P1.6 billion in the first semester, reversing the P538 million gains a year ago, due to lower deferred income tax recognized during the year and the higher final tax on investment securities.

However, the net interest income of the Yuchengco-led bank jumped by 28.8 percent to P19.7 billion from P15.3 billion, as the rise in interest earnings outpaced the growth in interest expense.

Interest earnings rose by 24.4 percent to P38.2 billion in the first half from P30.7 billion a year ago, while interest expense grew by 20.2 percent to P18.4 billion from P15.3 billion previously.

RCBC booked impairment losses of P3.6 billion, 4.4 percent higher than the P3.5 billion recorded a year ago. It represented 14.4 percent of total operating income.

The bank’s other operating income fell by 35.1 percent to P5.3 billion from P8.5 billion as miscellaneous earnings reached P830 million, down from last year’s P957 million due to lower rental income.

On the other hand, service fees and commissions increased by 33.2 percent to P3.9 billion from P2.9 billion on account of higher fee-based income.

Foreign exchange losses reached P219 million in the first half, a reversal of the P317 million in gains due to lower foreign exchange income from commercial transactions.

RCBC’s operating expenses inched up by 7.4 percent to P15.4 billion from January to June this year versus last year’s P14.3 billion on higher employee benefits, as well as payment for taxes and licenses.

The bank’s core business revenues for the first semester surged by 29 percent. This was driven by a 38-percent increase in consumer loans, lifting the net interest margin by 41 basis points to 3.71 percent.

The lender’s credit card portfolio jumped by 53 percent in the first half, as credit card billings rose by 42 percent, double the industry growth rate. Meanwhile, its auto and housing loan portfolio saw a substantial 28 percent year-on-year expansion.

As of the first half, RCBC’s personal and salary loan portfolio tripled, with loans generated digitally reaching P2 billion. Consumer loans represented 36 percent of the bank’s total customer loans, while the corporate as well as small and medium enterprise portfolios made up the remaining 63 percent.

The lender’s non-performing loan ratio stood at two percent as of end-June from 1.6 percent as of end-December 2023.

RCBC president and CEO Eugene Acevedo emphasized the bank’s commitment to customers and the innovative use of data and digital technology.

“By combining on-the-ground encounters with data insights, we create a digital customer experience that fuels the remarkable growth we are witnessing,” Acevedo said.

For the second quarter alone, the bank’s earnings fell by 15.4 percent to P2.2 billion from P2.6 billion in the same period last year as tax expenses stood at P979 million, a reversal from the P1.2 billion income tax a year ago.

RCBC’s capital adequacy ratio stood at 16.41 percent, while its common equity tier-1 reached 13.83 percent. Both exceeded regulatory requirements.

RCBC had a total consolidated network of 458 branches, 1,486 automated teller machines and 6,836 ATM Go terminals nationwide as of end-June.