SECURITY Bank on Monday reported an 11-percent decline in its net income for the first nine months of the year.
The bank said in a disclosure that its January-to-September net profit hit P6.5 billion, or 11 percent lower than its earnings in the same period last year. It put the blame on decrease in trading gains and higher provisions for income tax.
In particular, the bank’s trading gains was down 57 percent or P627 million from the year-ago level, while the provision for income tax was up by 73 percent or P769 million.
The decline in its net income could have been larger if not for its higher net interest income which grew 7 percent to P15.3 billion. In particular, interest income from customer loans and deposits alone grew by 30 percent or P2.6 billion to hit P11.3 billion during the period.
Interest income from financial investments, meanwhile, was lower by 13 percent or P1.1 billion. The bank said this was due to a lower level of securities portfolio which decreased by 18 percent year-on-year.
Operating expense growth was 13 percent, excluding provisions for credit and impairment losses. Cost-to-income ratio was 54 percent.
The bank said its asset quality remained in shape, with gross nonperforming loan (NPL) ratio at 0.7 percent. Provision for credit losses was P227 million for the nine-month period.
For the third quarter alone, the bank posted a P2.25-billion net income, up 5 percent from its year-ago level and 15 percent from its quarter-ago level.
This is despite lower loan growth at 8 percent to hit P401 billion.
“A key driver for the earnings growth was the continued expansion of the bank’s consumer loans and low-cost deposits,” the bank said.
Consumer loans grew 48 percent year-on-year, while low-cost deposits increased 18 percent.
Consumer loans now account for 19 percent of the bank’s total loans, up from 14 percent a year ago. Total deposits improved 9 percent to P468 billion, with high-cost deposits inching up 3 percent.
During the quarter, three new branches were opened in the high-growth Mindanao area: Davao City-Matina IT Park, Cotabato City and General Santos City.
Security Bank has a total of 302 branches nationwide.