Tuesday, 17 November 2009

Security Bank 9-month net income jumps 27%

Erik de la Cruz
Business Mirror

SECURITY Bank Corp. on Monday said its January-September net income jumped 27 percent to P2.2 billion from the same period last year, bringing annualized return-on-average equity (ROE)—a measure of profitability—to 21 percent.

Its ROE improved from 19 percent a year earlier.

Net income in the third quarter jumped 88 percent to P784 million.

Driving growth in the first nine months was the 21-percent increase in net interest income to P4.4 billion, which improved net interest margin to 4.4 percent from 3.9 percent. Interest income increased due to the shift in asset allocation from investment securities to loans, the midsized bank said in a statement.

Noninterest income grew 37 percent to P1.5 billion, reflecting profits from asset sales and trading gains that reversed last year’s losses.

“One of the bank’s objectives was to move toward a more balanced revenue profile. We are pleased that we are showing excellent improvements in both the net interest income and other income-revenue sources from our core businesses,” bank president and chief executive officer Alberto Villarosa said in a statement.

The bank’s balance sheet stood at P137.7 billion, relatively flat compared with the end-2008 level. Loans declined by 2.1 percent to P66 billion as of end-September, from P67.4 billion nine months earlier, and accounted for 48 percent of total assets.

Its investment-securities portfolio expanded at a slower pace of 5.1 percent to P47.6 billion, accounting for 34.6 percent of total assets.

Provisions set aside for credit losses amounted to P302.1 million for the first nine months, 39 percent higher than the P217.7 million booked for the comparative period last year.

“The provisions for the year represent the regular buildup of provisions for loans and receivables as a continuing effort to strengthen the bank’s balance sheet in support of the growth in the loan portfolio, rather than due to portfolio quality deterioration,” it said in notes accompanying its results.

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