Metrobank profit dips 10% to P20 B

MANILA, Philippines - The Metropolitan Bank & Trust Co. (Metrobank) has reported consolidated net income of P20.1 billion in 2014, down 10 percent from the P22.5 billion in 2013.

“The strong performance in the bank’s core business was driven by robust growth in loans and deposits, and relatively stable spreads amidst the low interest rate environment and tough competition,” Metrobank said in a statement.

In fact, a P7-billion income was realized in the fourth quarter.

Total resources hit a new high of P1.6 trillion, up 16 percent from last year’s P1.4 trillion.

Net interest income (NII) increased 20 percent to P45.8 billion, and contributed 61 percent of its total operating income compared to 48 percent in 2013.

Metrobank’s recent investments in its branch network, coverage expansion, and internal system enhancements were catalysts for its sustained balance sheet growth.

Deposits increased by 17 percent to P1.2 trillion, providing the bank with stable low cost funding to fuel its healthy loan expansion.

Loans and receivables further accelerated to close the year at P759.5 billion or 24 percent better with the commercial segment posting the strongest year-on-year increase.

Meanwhile, non-interest income was reported at P29.6 billion, consisting of P8.9 billion in service charges and commissions, P3.2 billion from trading and foreign currency exchange gains, and miscellaneous income of P17.5 billion. Miscellaneous income included the sale of non-core assets as well as foreclosed properties.

With the Bank’s focus on improving efficiency, operating expenses were kept at a reasonable level with recurring cost growth under six percent.

Asset quality continues to improve with non-performing loans (NPL) ratio dropping to a low of one percent, while NPL coverage increased to 165 percent. The bank reported provisions for credit and impairment losses of P4.8 billion.

Last year, Metrobank opened 64 branches to increase its domestic presence to 920 branches, still the largest in the industry. More than half of the network is located outside Metro Manila placing the Bank in a position to better service the demands of the regional growth areas of the economy. This network advantage is supplemented by 2,100 ATMs nationwide.

Under Basel III, the Metrobank’s total capital adequacy ratio (CAR) remained well above the regulatory limit at 16 percent, with Common Equity Tier 1 (CET1) at 12.1 percent.

Metrobank recently announced a stock rights offer (SRO) of up to P32 billion. Timing of the transaction is subject to receipt of regulatory approvals as well as market and other conditions. The SRO is expected to support the bank’s accelerating growth momentum and to further enhance its capital ratios.