In a financial report filed with the Securities and Exchange Commission, Chinatrust said the improvement was due to higher interest revenues, stronger fee-based business, robust trading gains and a tight rein on costs.
Interest income went up to P307.21 million from only P305.34 million while interest expense decreased by 6.5 percent to P127.48 million.
With a healthy loan portfolio and a sufficient loan-loss buffer, Chinatrust found no need to set aside incremental loan loss provisions in the first quarter. Total deposits increased by 14 percent from end-2002 levels, boosted tremendously by the sustained expansion of low-cost deposits.
Chinatrust’s capital adequacy ratio stood at 31 percent as of March 31 this year. This gives the bank a lot of room for continued balance sheet growth without any need for capital-raising programs.
Since last year, the bank has been steadily building up its middle market and consumer portfolio and has launched several successful marketing campaigns to support this growth objective. With loan demand remaining soft, Chinatrust has had to undertake a unique strategy to capture market share.
Last year, Chinatrust acquired the personal loan portfolio of Dutch banking giant ABN Amro NV in line with its strategy of refocusing on corporate and institutional banking.
It also launched a highly successful home loan campaign named Five@Zero, offering cash incentives to borrowers. Since its launch, this new promo has generated serious interest from over a thousand existing borrowers of other banks.
The bank’s one-of-a-kind Ultimate Deposit Account continues to attract depositors who are looking for the convenience of a genuine "one account."
For this year, Chinatrust hopes to duplicate its 2002 income performance by closely watching costs, raising the productivity of its human resource base, keeping a high-quality asset portfolio and continuing its roads into its chosen market segments.
Chinatrust plans to tap the debt market through the issuance of P2 billion worth of long-term negotiable certificates of deposits (LTCDs) to finance its growing portfolio of mortgage loans, personal loans, and corporate loans.
Chinatrust commenced operations on Sept. 5, 1995 initially as Access Banking Corp. until the Taiwan-based Chinatrust Commercial Bank acquired 60 percent of the bank in January 1996. The balance of the bank’s equity is owned by a group of Filipino-Chinese entrepreneurs led by Larry T. Villareal and William B. Go.
Its parent bank, Chinatrust Commercial Bank, is considered the largest privately-owned bank in Taiwan with 40 business offices operating in the island. Its global network includes three foreign branches in Hong Kong, India and Paraguay, two subsidiary banks in Indonesia and the Philippines, and six representative offices in London, Jakarta, Manila, Bangkok, Hanoi and Tokyo.
Chinatrust (Phils.) currently operates 10 branches in major business centers, including Ayala, Arranque, Binondo, Greenhills, Caloocan, Marikina, Pasong Tamo, Sta. Elena, Valenzuela and Subic.