Security Bank profit down 27%
SECURITY BANK Corp. saw its net income drop by 26.7% last year as it hiked its loan loss provisions to manage risks amid the coronavirus pandemic, the lender told the local bourse on Tuesday.
The bank’s net profit went down to P7.4 billion in 2020 from P10.1 billion it logged a year ago, based on its financial statement for 2019.
Return on shareholders’ equity was 6.16%. while return on assets was at 1.03%.
It set aside P26.4 billion as provisions for an anticipated surge in credit losses last year or over six times as much as the P4.2 billion recorded in 2019.
The lender said it set aside more loan loss reserves in 2020 on expectations that nonperforming assets would surge amid a pandemic-induced economic recession.
Security Bank’s net interest income went up by 14.2% to P30.65 billion last year from P26.84 billion in 2019. It booked a net
interest margin of 4.77%, up from 3.93% the year prior.
Its loan portfolio inched up by 1.5% to P456.244 billion from
P449.525 billion as retail loans went down by 10% while wholesale loans inched up by three percent.
Security Bank’s gross nonperforming loan (NPL) ratio climbed to 1.97% in 2020 from 0.56% in 2019. Its NPL reserve cover was at 115.47% last year, down from 129.2% previously.
Total revenues, meanwhile, jumped by 48% year on year to P50.4 billion.
On the funding side, the bank’s total deposit liabilities went down 12% to P440.41 billion from P499.61 billion a year ago due to reduced time deposits.
Low-cost savings and demand deposits grew 19% and increased to 60% of total deposits, up from 45% a year ago. High-cost deposits decreased 37%.
Non-interest income also rose by 178% to P19.723 billion from