METROPOLITAN Bank and Trust Co. (Metrobank) posted P5.2 billion in net income for the second quarter of 2018, or a robust 31-percent growth from P3.9 billion in the same period last year. This brings net income for the first half of the year to P11.0 billion, increasing by 16 percent year- on-year.
Metrobank’s solid performance was underpinned by the core business, as double-digit growth in loans and sustained CASA ratio lifted margins even higher, while recurring expense growth was kept at a manageable level.
“We are pleased to see that our efforts continue to bear fruit. Coming from the heels of a successful capital raising at the start of the second quarter, we have started to build good momentum that should allow us to meet our growth targets,” Metrobank President Fabian S. Dee said. “Together with achieving sustainable profitability, we are, likewise, making good progress in strengthening our risk management and operating controls,” added Dee.
The company’s loan growth guidance of high-teens was met, as the total portfolio expanded by 18 percent year-on-year to P1.3 trillion. The commercial segment led the growth at 21 percent, driven by the strong performance of top corporate accounts followed by middle market and SMEs. Meanwhile, the consumer portfolio maintained its mid-teens growth.
On the funding side, total deposits increased to P1.6 trillion at the end of the first half, and the Bank’s CASA ratio was maintained at 62 percent.
Net interest margin for the period was at 3.77 percent, which is five basis points higher against the comparative figure last year. On a quarter-on-quarter basis, there was a notable 14 basis point improvement in the NIMs to 3.89 percent in the second quarter. Net interest income stood at P33.3 billion, which accounted for 74 percent of the Bank’s total revenue of P45.1 billion.
Meanwhile, noninterest income rose by 14 percent to P11.8 billion—P6.8 billion in service fees and commissions and income from trust operations which was up 16 percent, P1.4 billion in net trading and FX gains and P3.6 billion in miscellaneous income. Fee-related revenues continue to benefit from steady customer-driven flows and FX income, and also boosted by the large corporate deals which were booked in the early parts of the semester.
Operating expenses, excluding taxes and licenses, increased at a slower pace of 10 percent to P21.7 billion. Manpower-related costs grew by 11 percent to P10.5 billion, while the balance was spent for the bank’s continuous efforts to improve its systems and streamline processes. Taxes and licenses were reported at P4.2 billion, inclusive of new tax-related requirements under the TRAIN law.
Asset quality metrics remained healthy and better than industry average. Non-performing loans ratio stayed flat quarter-on-quarter at 1.1 percent. For the first half, overall credit cost was kept well within the company’s guidance. The Bank reported provisions for credit and impairment losses of P3.5 billion, which is largely attributable to the impact of PFRS-9 adopted at the start of the year. On a quarter-on-quarter basis, provisions were 14 percent lower at P1.6 billion.
As of June 2018, Metrobank’s consolidated assets stood at P2.2 trillion and equity at P277.6 billion.