Metrobank’s capex for IT may hit ₧3.5B
METROPOLITAN Bank & trust Co. (Metrobank) is increasing its spending for information technology (it) projects and digital initiatives after government eased restrictions on mobility in Metro Manila.
in a disclosure on tuesday, the listed bank noted that 70 percent of its annual capital expenditure was earmarked for its it infrastructure. this translates to around p2.1 billion to p3.5 billion.
according to Metrobank’s preliminary information statement submitted to the philippine Dealing and exchange Corp., the amount is higher than its previous allocation.
the disclosure boosted Metrobank’s shares by 3.53 percent, or p1.30, to close at p38.15 each amid the 1.60-percent uptick for the benchmark index on tuesday.
the listed bank said its capex this year would be from p3 billion to p5 billion. its capex rose by 35.13 percent to 4.77 billion last year from 3.53 billion in 2018.
Metrobank president Fabian S. Dee said it was only imperative to boost the bank’s digital capabilities amid increasing demand during the enhanced community quarantine (ECQ ) when mobility was restricted.
“While the bank recognizes the need for building its capabilities, especially in digital banking, the ECQ ironically accelerated the transaction volume as customers have become more receptive and confident at transacting via e-platforms, maybe also partly due to the need to stay at home,” Dee said.
He added that there was a substantial increase in digital transactions following the lockdown, noting that new enrollments in e-channels doubled. Dee explained this was supported by instapay and pesonet transactions via Metrobank ’s mobile banking service.
“Metrobank’s objective now is to deliver to its customers the best of both world that only a bank uniquely offers, which are the convenience of electronic channels and assurance of a well-capitalized bank where money can be safely deposited,” Dee said.
it currently has total equity of p305 billion, with capital adequacy ratio at 17.6 percent—well above the 10-percent minimum regulatory requirement.
in the first quarter, Metrobank saw its net profits decline by 9 percent to p6.12 billion from p6.75 billion year-on-year on the back of higher provisions for bad loans.
the ty-led bank allocated p5billion allowance for nonperforming loans (npl) in the first quarter, which is more than double of what was earmarked for the same period in the previous year.
as of end-march, the bank’s npl ratio stood at 1.4 percent while npl coverage was at 114 percent.