Security Bank expects to sustain growth for 2017
SECURITY BANK Corp. expects to sustain or even surpass its 2016 growth level this year, despite market volatility amid global uncertainties.
Security Bank President and Chief Executive Officer Alfonso L. Salcedo, Jr. on Tuesday said that 2017 will likely be a good year for the bank even with jitters in the domestic markets over the possibility of faster interest rate hikes in the United States and the Philippines.
“(For) loan growth, we hope we can grow at 20% or if we can push higher than that we’ll be happy with it. Maybe on the bottom line, it’s double digit,” he told reporters on the sidelines of a company event.
The country’s sixth largest lender in asset terms saw its net income reach P1.9 billion in the last quarter of 2016, up by 18% year on year. This brought Security Bank’s full-year earnings to P8.55 billion, 11% higher than the P7.7 billion recorded in 2015 on the back of its robust core recurring income.
Its total loans and investments in corporate bonds stood at P317 billion last year, up 25% year on year, while corporate, commercial and loans climbed 20% to P289 billion in 2016.
Total consumer loans grew more than half last year or 56% year-on-year.
“But it’s really hard to tell, you know the outlook, it’s going to be very volatile. Interest rates are not predictable,” he added.
Markets are anticipating the US Federal Reserve to tighten policy rates by as much as three times within the year.
Philadelphia Fed President Patrick Harker said he will be open to hiking borrowing costs during the March 14-15 meeting, should key US job reports remain solid.
“So that creates a lot of volatility. But by large I think it should be a good year. Last year, we grew 11% on the bottom line, a little over 20% on the loan side. Deposits were quite good, so I think... maybe more of the same growth [for this year],” Mr. Salcedo further said.
Asked what other risk factors it sees this year, Mr. Salcedo noted that political noise at home “has reduced significantly.”
“I think the new President has stabilized... I think he has adjusted,” he said, referring to President Rodrigo R. Duterte, who took office on June 30, 2016.
The Security Bank chief also noted that political risk in the US has also subsided, saying, US President Donald J. Trump’s rhetoric has been “very tempered.”
Mr. Trump’s pro- America stance and political views on immigration, healthcare, fiscal policies and international trade have created a wave of negative sentiments among global market players that have likewise dragged US markets lower.
“So maybe the political risk has been reduced but still a lot of unpredictables,” Mr. Salcedo said, referring to up-coming elections in several European countries, par-