Metrobank income drops to P12.6 B in 9 months

MANILA, Philippines - Metropolitan Bank and Trust Co. (Metrobank) reported an unaudited consolidated net income of P12.6 billion in the first nine months, down 12.56 percent from the P14.41 billion recorded in the same period in 2015.

Net interest income, on the other hand, rose to P39 billion during the period, contributing close to 70 percent of the total operating income.

Non-interest income also increased 23 percent to P17.4 billion. This came from P7.7 billion in service charges, fees and commissions; P4.2 billion in net trading and foreign exchange gains; and P5.5 billion in miscellaneous income.

The company said its performance was mainly driven by robust growth in low cost deposits and loan demand, which surpassed the company’s expectations.

“We are pleased with the positive trends we see in our core business. Low cost funding remains healthy, our margins are improving amid heavy competition, and  loan demand is better than we originally expected,” Metrobank president Fabian Dee said.

The bank’s low cost current account, savings account (CASA) grew 21 percent to P790.8 billion in the first nine months of 2016. CASA ratio increased to 63 percent of the total P1.2 trillion deposit base, as compared to 56 percent in 2015.

Net loans and receivables, likewise, rose 26 percent to P965.1 billion, accounting for 56 percent of Metrobank’s total assets from 46 percent last year.

Metrobank senior vice president Jette Gamboa said the demand in loan grew faster than the industry’s performance, which stood at 17.7 percent as of July.

The commercial segment led the growth in loan portfolio, up 29 percent year-on-year. This was driven by high capital expenditure requirements amid growing infrastructure spending in the country.

Meanwhile, the bank’s consumer segment also rose 17 percent, with auto loans making up the bulk of the bank’s consumer assets.

“Because of our strength on generating these low cost deposits and the very robust growth we’ve seen in our loan portfolio, (our) net interest margin is actually better. (We’re) at 3.65 percent coming from three and a half percent. We’re proud of that,” Gamboa said.

The Ty-led bank incurred a total operating expense of P33.3 billion during the nine-month period, as it continues to hire front line personnel, such as sales and marketing officers. The company plans to hire about 1,000 new personnel over a three-year period until 2017.

The ratio of the bank’s non-performing loans improved to 0.9 percent despite the growth in its lending activities.

Metrobank also reported a total consolidated assets of P1.7 trillion, and equity of P201.4 billion as of end-September. Total capital adequacy ratio stayed at 17.6 percent, above the regulatory limit and the highest among its peers, with Common Equity Tier 1 ratio at 14.5 percent.