Security Bank posts 8.5% increase in Q1 net income

CEBU, Philippines - Publicly-listed Security Bank Corporation posted an 8.5 percent increase in its net income for the first quarter this year, to P1.01 billion, which equates to an annualized return equity (ROE) of 16.1 percent.

In an official disclosure statement, the bank reported an asset base which stood at P183.5 billion, a P39.9 billion or 27.8 percent growth from end of March 2010.

A 25.7 percent or P16.8 billion increase was noted in loans, which is considered as a primary driver behind the significant increase in the bank’s resources.

Meanwhile, deposits stood at P106.1 billion, a 9.4 percent improvement versus the same quarter last year.

With the exceptional profitability reported for 2010 and the profit performance recorded for the first quarter, the bank’s capital level stood at P26.4 billion, a whopping 34.4 percent improvement over the same period of 2010.

With the robust growth in the bank’s lending portfolio, net interest income stood at P1.6 billion, a P141.7 million or 9.5 percent increase over the first quarter of 2010.

Non-interest income stood at P 452.0 million, while lower than that reported for the first quarter of 2010 due to the absence of opportunities for securities trading gains present the year before; nonetheless reflected noteworthy gains in customer driven revenues.

In particular, service charges, fees and commissions, which stood at P226.8 million for the period, reflected a 18.7 percent growth over the prior year.

In addition, the bank sustained its performance in servicing customer driven foreign exchange flows with gains recorded for the period of P470.6 million, up by P181.8 million or 62.9 percent.

The bank further reported that operating expenses, excluding provision for credit and impairment losses, amounted to P 977.8 million, or seven percent lower than the comparable period in 2010 as the bank reported a decline in retirement and advertising expenses. 

As a consequence of the moderated expenses and the revenue performance, the bank continued to report a cost to income ratio of 47 percent.

Security Bank’s non-performing loans (NPL) ratio of 1.1 percent for the period remains among the best in the industry with related NPL cover at 310 percent

The bank continues to report a fundamentally strong capital base with its capital adequacy ratio at 15.5 percent for the period. (FREEMAN)