FMIC net profit jumps 76%

MANILA, Philippines - First Metro Investment Corp. (FMIC), the investment banking arm of the Metrobank Group, said its consolidated net income reached P1.9 billion in the first half of 2012, 76 percent higher than the P1.1 billion profit registered in the same period last year.

In a disclosure to the Philippine Stock Exchange yesterday, FMIC attributed the earnings growth to higher interest income from fixed-income securities, trading gains from the sale of government securities, distribution fee income and brokering fee.

Its Investment Banking Group generated total revenue of P258 million or P40 million higher than last year. This was generated through various deals that include SM Prime Holdings’ P7.5-billion fixed rate corporate notes; Filinvest Land’s P11-billion fixed rate bonds; Ayala Corp.’s P10-billion retail bonds; Ayala Land’s P10-billion retail bonds; GT Capital Holdings’ P21.6-billion IPO; and FP Finance Ltd.’s $200 million term loan.

The Investment Advisory Group, on the other hand, realized P160 million in net trading gain and dividend income from investment in stocks. This is a substantial jump of 3,100 percent from last year’s result of P5 million.

“Our first half result was supported by favorable macroeconomic conditions. The debt and equity volume for the first half reached P424 billion and First Metro accounted for P291 billion or a notable 70 percent market share. In 2011, total capital markets fundraising reached P1.04 trillion and we contributed P805.0 billion or 78 percent of the total funds raised,” FMIC president Roberto Juanchito Dispo said.

As of June 30, 2012, FMIC’s consolidated resources, however, dropped to P75 billion or five percent lower than the yearend 2011 balance of P79 billion.

The decrease was mainly brought about by the net effect in deposits due to the change in the reserve requirement on deposit substitute liabilities from 21 percent to 18 percent, net sales of investment securities and net collections of loans and receivables.