RCBC income nets P2.2 billion in Q1

MANILA, Philippines — Rizal Commercial Banking Corp. (RCBC) reported a net profit of P2.2 billion in the first quarter, 39.4 percent lower compared to the P3.64 billion recorded in the comparable quarter last year.

This was amid lower non-recurring income and higher operating expenses.

On the other hand, the lender’s total resources expanded by seven percent to P1.23 trillion with the steady build-up of earning assets, which was mostly driven by loan expansion especially in the consumer segment.

Credit card loans rose by 55 percent in the first quarter, outperforming the industry’s 30 percent average growth, due to the bank’s data-driven acquisition and cross-selling campaigns to manage portfolio quality.

The bank also saw a 42-percent increase in credit card billings while personal and salary loans more than doubled from last year, as RCBC continues to improve customer experience across its platforms.

Supporting the asset build-up was the solid increase in deposits by 12 percent to P959 billion, boosted by the 13 percent rise in CASA deposits.

“We continue to reap the benefits of the bank’s continued digital transformation across the organization,” RCBC president and CEO Eugene Acevedo said in a statement.

“From AI and data-driven campaigns to streamlined processes via robotic process automation, we commit to exploring new and exciting ways we can bring customer experience to the next level,” he added.

Based on its financial statement, RCBC’s other operating income declined by 53.3 percent to P2.68 billion in the first quarter from P5.73 billion a year ago.

This, as gains on assets sold fell by 96.7 percent to P112 million from last year’s P3.35 billion. In the first quarter of 2023, the bank benefitted from the sale of its various real estate properties.

Likewise, gains from trading and securities decreased by 17.2 percent to P48 million from P58 million in the first quarter last year.

Foreign exchange gains reached a net loss of P37 million, a reversal from the P405 million gains a year ago, due to “lower revaluation profit and lower foreign exchange income from commercial transactions.”

The bank’s fee income from its trust operations also declined by 100 percent due to the spin-off of RCBC Trust Operations to a stand-alone trust firm on Jan. 2.

Meanwhile, income from service fees and commissions jumped by 43.8 percent to P2.04 billion from P1.42 billion in the comparable year-ago period.

The bank’s miscellaneous earnings also grew by 32.4 percent to P507 million in the first quarter from P383 million in the same period last year due to higher dividend income.

RCBC’s operating expenses grew by 22.3 percent to P7.77 billion from January to March this year compared with P7.19 billion in the same period last year on higher employee benefits, as well as expenses related to occupancy and equipment.

The provision for potential loan losses climbed by 12.1 percent to P1.67 billion from P1.49 billion and represented 13.7 percent of total operating income.

However, the bank’s non-performing loan ratio stood at 1.7 percent as of end-March, 53 basis points lower from the previous year.

The Yuchengo-led bank’s capital adequacy ratio was at 16.27 percent while its common equity tier-1 (CET-1) ratio stood at 13.71 percent in the first quarter, well-above regulatory requirements.

As of end March, RCBC had a total consolidated network of 458 branches, 1,465 automated teller machines, and 6,246 ATM Go terminals strategically located nationwide.