Philippines: Security Bank earns $94.3mln in 6 months

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Earnings of Security Bank Corp. grew by 10.6 percent to P5.44 billion in the first half from P4.92 billion in the same period last year, mainly driven by continued growth in business drivers.

For the second quarter alone, the bank's net income rose by 10.2 percent to P2.82 billion from P2.56 billion a year ago.

Security Bank president and CEO Sanjiv Vohra said the bank's second quarter performance reflected the increasing momentum of retail, MSME and wholesale client teams.

'We allocated substantial resources to support our clients' aspirations as indicated in the growth of loans and deposits,' he said in a statement.

Based on its quarterly report, Security Bank saw a 38.2-percent rise in net interest income to P21.7 billion in the first half from P15.7 billion a year ago. Total operating income also rose by 25 percent to P25.7 billion from P20.6 billion.

Service charges, fees and commissions surged by 75 percent to P4.9 billion from P2.8 billion due to higher transaction volumes and bancassurance milestone fee of P2 billion.

The bank's net interest margin stood at 5.20 percent in the first semester, up 96 basis points from 4.24 percent in the comparable year-ago period.

Total operating expenses went up by 30.7 percent to P18.3 billion from P14 billion as the bank invested in manpower and technology to improve operations. This translated to a cost-to-income ratio of 58.4 percent compared to 60.4 percent a year ago.

Security Bank set aside P3.3 billion as provisions for credit losses in the first six months, an increase versus last year's P1.6 billion.

The non-performing loan cover of Security Bank went down to 81 percent from 82.13 percent despite the higher NPL ratio of 1.48 percent from 1.37 percent.

Security Bank reported a return on assets at 1.2 percent, while return on shareholders' equity improved to 7.94 percent from 7.67 percent.

The lender also recorded a 19-percent expansion in loans, higher than the 12-percent rise a year ago. On a quarterly basis, loans increased by six percent to P577 billion as of June. Retail and MSME loans grew by 37 percent, while wholesale loans increased by 14 percent.

'The growth in retail and MSME loans was driven by home loans which grew 21 percent, credit cards which rose 60 percent, auto loans which grew 50 percent and MSME loans which increased 68 percent,' the bank said.

Meanwhile, deposits jumped by 29 percent to P676 billion as of June. CASA deposits increased nine percent year-on-year, making up 54 percent of total deposits.

Security Bank's capital ratios remain strong with a common equity tier 1 ratio of 13.9 percent and capital adequacy ratio of 14.8 percent.

Shareholders' capital stood at P138 billion, while its asset base grew by 19 percent to P948 billion. The 73-year old bank has 328 branches and 662 ATMs nationwide.