03 November 2014, Makati, Philippines – Security Bank Corporation (PSE: SECB) earned Php 6.428 billion in net income in the first nine months of 2014, representing 54% year-on-year growth and 20% return on shareholders’ equity (ROE).
Security Bank posted solid growth in core business, with loan portfolio increasing by 25% year-on-year to Php 181 billion and deposits growing by 26% to Php 232 billion. The loan-to-deposit ratio was 78%. Total assets was at Php 366 billion as of September 30, 2014, 33% higher than year-ago level. The return on assets (ROA) was 2.3%.
Net interest income increased by 37% year-on-year to Php 8.5 billion in the nine-month period. Net interest margin was 3.4% during the period. Core revenues – comprising of net interest income, fee-based income, and trading gain attributable to customer flows – grew by 27% to Php 10.2 billion. Fee-based income inclusive of asset management was Php 1.2 billion. Over-all trading gain was Php 3.6 billion.
Security Bank’s total operating income increased by 41% year-on-year to Php 13.5 billion. Operating expense growth (excluding provision for probable credit losses and impairments) was 13%. The cost-to-income ratio was 42%.
For the three-month period ended September 30, 2014, Security Bank earned Php 2.8 billion in net income, up by 13% year-on-year and 29% quarter-on-quarter. Net interest income during the quarter was Php 2.7 billion. Non-interest income was Php 2.5 billion. The Bank realized Php 1.9 billion in trading gain through sale of securities. The investment securities at amortized cost portfolio was at Php 74 billion as of September 30, 2014 from Php 111 billion a quarter ago.
Security Bank’s net NPL ratio was at 0.21% as of September 30, 2014 compared to 0.16% a year ago. Notwithstanding the strong asset quality, provision for probable credit losses for the first nine months of 2014 was Php 784 million. The NPL reserve cover increased to 212% as of September 30, 2014 compared to 193% a year ago.
Security Bank’s capital attributable to shareholders grew by 14% year-on-year to Php 46 billion primarily due to retained earnings. Payment date for the second semester cash dividends of Php 1.00 per share to stockholders is on November 10, 2014.
Security Bank President and Chief Executive Officer Mr. Alberto S. Villarosa said, “All of our business segments sustained strong results in the third quarter. They continue to deliver healthy returns on our investment in branch network expansion in 2012-2013.”
Security Bank Chief Financial Officer Mr. Joselito E. Mape said, “Our Basel III Common Equity Tier 1 (CET 1) increased to 14.3% as of September 30, 2014 from 13.2% a quarter ago. Total Capital Adequacy Ratio (CAR) increased to 18.5% from 14% a quarter ago after we issued Php 10 billion in Basel III compliant Tier 2 Notes in July 2014.”
The Security Bank group has a network of 254 branches and 468 ATMs as of September 30, 2014. The Bank’s Board approved on October 7, 2014 the integration of 39 branches of thrift bank subsidiary Security Bank Savings into parent Security Bank to streamline the retail bank focus and widen the product scope of these branches. The Board also approved the bancassurance agreement with FWD Life Insurance Corporation. Both actions are subject to regulatory approval. FWD – the insurance arm of Pacific Century Group led by Hong Kong-based businessman Richard Li – is a high-growth, technology driven insurance company focused on the Asian region.
About Security Bank
Security Bank is among the eight largest private domestic universal banks in the Philippines with total assets of Php 366 billion, loan portfolio of Php 181 billion, and total capital at Php 47 billion as of September 30, 2014.
Security Bank has been a recipient of numerous awards, among which, in 2014, the Bank was Best Overall Domestic Provider of FX Services in the Philippines as voted by Corporates and Financial Institutions by Asiamoney, and Best Service Provider and e-Solutions Partner Bank in the Philippines by The Asset. In 2013, the Bank was Best Managed Bank in the Philippines by The Asian Banker of Singapore. In 2012, Security Bank was Bank of the Year in the Philippines by The Banker of London, and the Strongest Bank in the Philippines by The Asian Banker. The Bank has been operating for 63 years since it was established in 1951.
More information is available on our website: www.securitybank.com.