RCBC reports 24% jump in profit

MANILA, Philippines - Yuchengco-owned Rizal Commercial Banking Corp. reported a 24 percent jump in its unaudited net income  in 2012 to P6.21 billion from P5.01 billion in 2011.

In a statement, the bank said the increase in earnings was brought about by higher trading gains and fee-based income.

Despite pressures on margins due to low interest rates, RCBC’s net interest income grew 6.5 percent to P11.45 billion through loans.

Net interest margin remains one of the highest in the industry at 3.95 percent.

Other operating income likewise went up 14 percent to P11.22 billion, with the support of the sustained growth of trading and foreign exchange gains by 32.9 percent, trust fees by 17 percent and service fees and commissions by 7.5 percent.

“The bank consistently builds its financial strength following a strategy of prudent balance sheet management,” it said.

Total deposits reached P249.2 billion as of end-2012 of which 57 percent were CA/SA deposits.

Total consolidated resources grew to P369 billion in 2012 from P347.7 billion the previous year.

Loans increased to P190 billion with the sustained growth in consumer loan bookings by 25 percent, SME loan bookings by 37 percent, and corporate loan bookings by eight percent, as the bank continues to grow its portfolio in less cyclical business in consumer banking, SME and microfinance.

The bank’s capital doubled to P68.45 billion in 2012 from P34.32 billion in 2011.

The bank’s non-performing loan (NPL) ratio stood at 0.98 percent.

It expects further improvement in its asset quality as the sale of its non-performing assets (NPAs) to Philippine Asset Growth One Inc. is being finalized. PAGO is formed by the International Finance Corp., OSK Group - Malaysia and Altus Transaction Services, Inc.

Last year, the bank’s operating expenses grew 8.8 percent to P13.27 billion. But with a new core banking platform carried out in 2012, the bank is expected to improve its transaction efficiency and productivity.

As part of the its ongoing strategy to deepen customer penetration in the next five years, RCBC’s branch network increased from 387 in 2011 to 420 in 2012.