Security Bank targets 20% hike in loans

MANILA, Philippines - Security Bank Corp. president and chief executive officer Alberto S. Villarosa said they expect a 20 percent increase in Security Bank’s loan portfolio this year.

“The loan growth should continue to be good. We would like to target almost the same growth rate in percentage terms we experienced in 2014 over a higher base,” Villarosa told reporters.

He said loans could have grown  by roughly 20 percent last year from 2013, while deposits were also estimated to have increased by 20 percent.

Latest available data from the bank showed its loan portfolio jumped 25 percent year-on-year to P181 billion as of September, while deposits surged 26 percent to P232 billion. The fourth quarter and full-year financial report will be released some time this month. The  expected rise in loans will occur despite the Bangko Sentral ng Pilipinas’ stricter capital requirements and other regulations on credit, Villarosa said.

According to Villarosa, the immediate impact of the tightened rules on credit and other central bank measures would be a slower lending growth.

“But I like to look at it more as a good prudential measure to make sure that the banking system continues to be sound,” Villarosa said.

The BSP last year started requiring higher capital requirements for universal and commercial banks under the more stringent Basel 3 reforms. Separate real estate stress tests and guidelines for too big to fail banks were also released later in 2014, imposing even higher capital ratios for the lenders.

Security Bank last week completed its $300-million bonds issuance which was even oversubscribed by nearly six times. The notes, which will mature February 2020, were priced at par with a yield of 3.95 percent and will pay coupon at a rate of 3.95 percent per annum on a semi-annual basis.

Villarosa said that the bank remains open to issuing more bonds “if the market conditions” are right and “it makes sense for us to raise” more.

The bank has 254 branches and 468 automated teller machines (ATMs) as of September last year. 

“We’re targeting 10 branches this year. We’re hitting the pause button because in the last two years we opened a lot branches especially in the restricted areas, which is Metro Manila,” Villarosa said.

Security Bank increased its net income by 54 percent to P6.428 billion in the nine months to September last year from P4.2 billion in the same period in 2013.