Metrobank’s financial results drive trading

INVESTORS took positions on Metropolitan Bank and Trust Co.’s (Metrobank) stock last week after the release of its fullyear 2023 earnings results.

Data from the Philippine Stock Exchange showed the Ty-led Metrobank trading P1.09 billion worth of 18.25 million shares from Feb. 19 to 23, making it the seventh most actively traded issue last week.

It went up by 1.9% at P61.20 apiece last Friday from P60.05 on Thursday.

On a week-on-week basis, Metrobank rose by 3.6% from its closing price of P59.05 per share on Feb. 16.

Year to date, the bank’s share price was up by 19.3%.

Luis A. Limlingan, head of sales at Regina Capital Development Corp., said in a Viber message that Metrobank’s dividends and robust financial performance drove the heightened trading activity last week.

“Metrobank’s revenue outlook is promising due to its diversified income streams and strong operational performance. With continued economic recovery and sustained business momentum, supported by resilient consumer demand and favorable interest rate environment, Metrobank is well-positioned to maintain revenue growth trajectory,” Mr. Limlingan said.

“Furthermore, the bank’s strategic initiatives to enhance digital capabilities and expand market presence are expected to drive revenue generation in the upcoming quarters,” added Mr. Limlingan.

Philippine National Bank Equity Research department Head Jonathan J. Latuja also said in an e-mail that revenue earnings added to Metrobank’s active trading last week, which was relatively favorable.

“Metrobank’s net income increased 29% year on year to P42.2 billion in 2023. Net interest income rose by 23% to P105 billion, on the back of 8% growth in gross loans and 34 bps improvement in net interest margin to 3.9%. Total revenues were up but at a slower pace of 19% since noninterest income only grew by 6%,” Mr. Latuja said.

Metrobank reported a 28.9% increase in its attributable earnings to P42.24 billion during 2023, surpassing the P32.78 billion in the previous year, driven by asset expansion, higher margins, improved efficiency levels, and better asset quality.

This resulted in a return on equity of 12.5%, higher than 10.3% in 2022. Total consolidated assets expanded by 9.2% to P3.1 trillion in 2023, maintaining its status as the country’s secondlargest private commercial bank.

The bank’s strong profitability and substantial capital base motivated the directors to approve a total cash dividend of P5 per share for the year. The regular dividend was raised from P1.60 to P3 per share to be paid out semiannually at P1.50 per share. Additionally, a special cash dividend of P2 per share was declared.

The bank’s net interest income grew by 22.7% due to higher loan demand and a better net interest margin of 3.9%.

Gross loans rose by 7.6% year on year, with consumer portfolio increasing by 15.9% on strong discretionary spending, outpacing the 5.5% rise in commercial loans.

Meanwhile, total deposits grew by 7.3% from the previous year to P2.4 trillion with low-cost current and savings accounts amounting to more than 60% or P1.4 trillion.

The bank’s full-year gross revenue increased 43.3% to P100.54 billion from P70.18 billion recorded in the year 2022.

Data from the Philippine Statistics Authority showed that the country’s gross domestic product grew by 5.6% in 2023, much slower than the 7.6% expansion in 2022.

The economic growth is below government target of 6-7% for the year but still maintaining the position of being one of the bestperforming economies in Asia.

Mr. Limlingan expects the stock support level is situated at P59.40 per share, while its resistance sits at P62.50 per share. —