Security Bank Corp., the sixth-largest lender in terms of assets, posted a net income of P4.95 billion in the first half, up 15 percent year-on-year, on the back of the strong performance of core businesses.
Net profit in the second quarter jumped 32 percent to P2.57 billion on year. Total revenues grew 32 percent to P7.9 billion.
Net interest income from customer loans and deposits sustained its strong trajectory increasing by 44 percent to P5.4 billion.
“This was driven by the continued expansion of retail loans and low-cost deposits. Retail loan growth accelerated to 54 percent year-on-year while low-cost deposits increased 11 percent. Retail loans now account for 25 percent of total loans versus 18 percent a year ago,” the bank told the stock exchange Wednesday.
Total loans rose 11 percent year-on-year to P427 billion while total deposits stood at P449 billion.
The bank on June 28 issued P18 billion worth of fixed-rate peso corporate bonds with a tenor of two years as a cost-efficient funding source alternative to short-term high-cost deposits.
Total deposits and peso corporate bonds combined rose 5 percent year-on-year. Net interest spread on loans and deposits increased to 5.36 percent in the second quarter 2019, up 38 basis points quarter-on-quarter and 108 basis points year-on-year.
Total net interest income climbed 22 percent to P6.1 billion. Interest income from financial investments grew 7 percent. Overall, net interest margin increased to 3.59 percent in the second quarter 2019, up 18 basis points quarter-on-quarter and 42 basis points year-on-year.
Service charges, fees and commissions increased 70 percent to P1 billion. The rise was driven by loan fees, credit cards, deposit charges and bancassurance.
Securities trading gains in the second quarter amounted to P376 million, while total non-interest income increased 81 percent year-on-year to P1.7 billion.
The bank’s asset quality remained healthy, with gross non-performing loan ratio at 1.1 percent against 0.75 percent a quarter-ago, and lower than the industry’s 1.7 percent as of May 2019. The bank set aside P639 million for provision for credit losses in the first half. NPL reserve cover was 127 percent.
