Security Bank posts record net profit

Security Bank Corporation posted a record-high R8.55 billion in net profit in 2016, up 11 percent, driven by strong growth in core recurring income.

In a disclosure to the Philippine Stock Exchange, the bank said net interest income increased 28 percent to R15.9 billion, which more than offset the R1.1-billion decrease in trading gains.

Gains on sale of securities were lower at R1.8 billion from R2.9 billion in 2015. Net interest margin was steady at 3.1 percent.

For the fourth quarter 2016, Security Bank’s net income increased 18 percent year-on-year to R1.9 billion, driven by a 30 percent increase in net interest income to R4.4 billion.

Total loans and investments in corporate bonds increased 25 percent to R317 billion. Corporate, commercial and retail customer loans increased 20 percent to R289 billion.

Deposits likewise grew 20 percent to R347 billion, with low-cost deposits increasing 20 percent.

Loan growth continued its trajectory by segment with corporate and commercial loans growing 20 percent and total consumer loans increasing 56 percent.

Credit card receivables decreased by 5 percent due to the sale of the Diners Club franchise. Retail loans account for 13 percent of total loan portfolio, up from 10 percent in 2015. Total assets increased 31 percent to R695 billion.

“We are pleased with the quality of our earnings. Our 2016 results show steady progress in our core recurring income,” said Security Bank President and Chief Executive Officer Alfonso L. Salcedo Jr.

He added that “the growth in our net interest income more than offset the lower trading gains. Notably, the growth in our net interest income has accelerated to 30 percent year-on-year in Q4-2016 from 28 percent in previous quarters.”

“Our loans and deposits are growing robustly. Our asset quality and cost-to- income are in good shape. We continue to invest in growing the business,” Salcedo said.