Security Bank ramps up expansion

MANILA, Philippines - Security Bank Corp. is ramping up its expansion program by opening at least 35 new branches per year over the next five years.

Alfonso Salcedo Jr., president and CEO of Security Bank, said the program entails the opening of more branches than the current average of 30 new branches per year.

“Over the coming years we want to grow by a minimum of 35. If we could expand faster than that we would. What is important for us is finding the right location,” he said.

Security Bank intends to open 15 more branches before the end of the year after opening 15 branches since January. This would bring the bank’s footprint to 292 by the end of 2016. About 60 percent of the bank’s network is concentrated in Manila.

To further expand its reach, Salcedo said 70 percent of the branches to be established would be situated in the provinces, while only 30 percent would be situated in Manila.

“We don’t want to compromise location just to say we opened a branch. We don’t want to compromise on having good quality manpower staffing all of those branches,” he said.

The bank president is confident the bank would be able to sustain its strong financial performance in the first half of the year especially with the entry of the Bank of Tokyo – Mitsubishi UFJ Ltd early this year.

The Japanese bank pumped in P37 billion in fresh equity, making it the second largest shareholder in Security Bank with 20 percent next to the family of businessman Frederick Dy.

Security Bank’s net income amounted to P4.9 billion in the first half from P3.5 billion in the same period last year mainly due to higher net interest profit.

Net interest income jumped 28 percent to P1.6 billion helping offset the P1.4-billion decrease in securities trading gains to P1.6 billion from a high of P3 billion.

Service charges, fees and commissions rose 25 percent to P1.1 billion, propelled by bancassurance, credit cards, loan fees and advisory, while foreign exchange income increased two-fold to P422 million.

“Basically what we have been trying to do over the years is to increase our recurring core revenues and decrease our dependence on one-time trading gains,” Salcedo said.

According to him, Security Bank would continue to focus on wholesale and retail banking as well as the financial markets.

Security Bank is the country’s sixth largest bank in terms of assets with P516.59 billion and seventh in terms of capital with P56.02 billion as of end-March.