Metrobank income more than doubles in first half

By Donnabelle L. Gatdula, The Philippine Star

Posted at Aug 02 2013 09:22 AM | Updated as of Aug 02 2013 05:22 PM

MANILA, Philippines - Metropolitan Bank & Trust Co. (Metrobank), the main banking unit of the Ty family, registered an unaudited consolidated net income of P18.1 billion in the first half of 2013, more than doubled the P7.4-billion earnings in the same period last year.

The bank said the strong performance during the period already surpassed its full-year net income of P15.4 billion in 2012.

Metrobank said key drivers of the impressive earnings include the steady growth in core revenues, robust expansion in treasury and investment activities, and increase in miscellaneous income.

The bank’s total operating income expanded by P16.6 billion to reach P45.9 billion in the first semester. This was achieved on the back of a 13-percent rise in net interest income to P17.3 billion, coupled with a P14.7-billion increase in non-interest income to P28.6 billion.

Metrobank said it likewise sustained its loan growth momentum with a 16-percent expansion to close the period at P545.8 billion.

Credit demand was consistent across all sectors, with the consumer segment leading the growth.

Total deposits reached P876.6 billion, a 32-percent increase year-on-year, predominantly from current and savings accounts (CASA).

Meanwhile, non-interest income was driven by strong earnings from treasury and investment activities of P14.3 billion, the steady increase in service charges, fees and commissions to P4.2 billion, and miscellaneous income of P10.1 billion.

Miscellaneous income includes the one-time gain from the sale of non-core assets. The bank sold its remaining 15-percent stake in Toyota Motor Philippines Corp. in January and a 20-percent stake in Global Business Power Corp., through subsidiary First Metro Investment Corp., in June 2013.

The transactions were in line with efforts to strengthen Metrobank’s capital base in preparation for Basel 3 implementation next year.

On the other hand, increases in operating expenses were mainly due to manpower related costs, in particular the renewal of a three-year collective bargaining agreement with unionized employees.

The bank also incurred higher taxes related to the sale of non-core assets.

Metrobank continued its branch expansion strategy to expand coverage and provide better accessibility to its client base. It maintains the largest consolidated domestic network of 832 branches, supplemented by 1,822 ATMs nationwide.

Asset quality remains well under control as non-performing loans (NPL) ratio further improved to 1.8 percent from 2.2 percent in the same period last year.

During the period, Metrobank set aside provision for credit and impairment losses amounting to P2.7 billion on a consolidated basis, raising NPL coverage to 125 percent from 109 percent previously.

The bank ended the first semester with P1.2 trillion in consolidated assets and P135.6 billion in equity.

Total capital adequacy ratio (CAR) remained well above the regulatory limit at 18.1 percent, with Tier 1 CAR at 15.7 percent.