Eyeing 3 banks for acquisition Security Bank plans to grow its network

CEBU, Philippines - Aside from its plan to open up 50 branches by next year, specifically within the Bangko Sentral Ng Pilipinas (BSP) identified “restricted areas”, publicly-listed Security Bank Corporation is eyeing three development banking institutions for acquisition.

In an interview with Security Bank president and chief executive officer (CEO) Alberto S. Villarosa said the bank is intensifying its move to boost its capitalization, and expand its distribution network across the country.

Recently, the bank acquired the Premier Bank that added its number of distribution outlets to now 170 branches nationwide.

The bank is positioned to hit 25 percent growth this year, in terms of customer-based. Excluding the customers it automatically acquired following the Premier Bank buy-out, Security Bank has over 250 thousand customers (not accounts).

In loans and deposits, the bank targets to grow by 20 perent to 22 percent this year, he said.

Security Bank posted P4 billion reveues in the third quarter this year, a 21 percent increase from the same period last year.

Likewise, the bank also recorded a 20 percent high return on equity (ROE) within the period.

The earnings improvement was underpinned by continued strength of core revenues with net interest margin increasing 21 percent to P5.5 billion on the back of customer loans growing at 23 percent to P84.5 million.

The healthy net margins were supplemented by Service Charges and FX (foreign exchange) Income growing by 17 percent. These more than compensated for lower trading gains, resulting to total revenues of P7.7 billion, 6.2 percent higher than the figures from the same period last year.

The bank’s operating expenses, excluding provisions and impairment losses, were steady at P 3.3 billion from the year-ago level, translating to a cost to income ratio of 42.5 percent.

The balance sheet as of the third quarter of 2011 expanded to P196.8 billion or 36.2 percent from the same period in 2010 due mainly to customer loans and trading and investment securities.

Asset quality numbers continue to remain industry best with Non-performing loans (NPL) ratio and cover of 0.9 percent and 338 percent, respectively.

Furthermore, the bank’s Capital Adequacy Ratio (CAR) at 18.3 percent shows a fundamentally sound capital base allowing for further expansion and growth.--- (FREEMAN)