August 15, 2022, Makati City, Philippines – Security Bank Corporation (PSE: SECB) posted a 100% year-on-year increase in net profit to PHP 6.2 billion in the first half of 2022, driven by core business growth, lower credit provisions and standardized income tax provisions.
Net interest income increased by 6% to reach PHP 14.4 billion. Total non-interest income was PHP 4.8 billion. Service charges, fees and commissions increased by 22% to reach PHP 2.6 billion, due to higher fees on deposits, credit cards and capital markets. Other non-interest income, excluding securities trading gains and commission income, increased by 47% to reach PHP 2.2 billion, mainly due to foreign exchange income and the collection of assets written off.
Operating expenses increased by 4%, thanks to investments in technology and workforce to improve the customer experience. The cost/income ratio was 55.9% versus 56.4% a year ago.
Operating profit before provision was PHP 8.5 billion, up 6% year-on-year. The Bank made PHP 408 million in provisions for credit losses in the first half of 2022, down from the previous year’s level of PHP 2.4 billion. The gross non-performing loan ratio declined to 3.28% from 3.65% in the prior quarter. NPL reserve coverage increased to 92% from 90% in the prior quarter.
Return on assets increased to 1.70% from 0.92% in the first half of 2021. Return on equity increased to 10.0% from 5.05% a year ago.
Quarterly results: For the period from April 1 to June 30, 2022, net profit was PHP 3.5 billion, 139% higher than a year ago and 29% higher than a quarter ago . On a sequential quarterly basis, total revenue increased 7% to reach PHP 10.0 billion. Net interest income increased by 7% to reach PHP 7.5 billion. Net interest margin in Q2-2022 was 4.36%, up 3 basis points quarter-on-quarter and up 7 basis points year-on-year. Total non-interest income increased by 7% to reach PHP 2.5 billion. Service charges, fees and commissions increased 2% to PHP 1.3 billion. Other non-interest income, excluding securities trading gains and commission income, increased 17% to PHP1.2 billion.
Operating expenses in Q2-2022 were 4% lower compared to the previous quarter.
Pre-provision operating profit in Q2-2022 was PHP 4.7 billion, 23% higher than a quarter ago. In Q2-2022, the Bank made PHP 328 million in provisions for credit losses.
The balance sheet remains strong
Low-cost savings and demand deposits increased by 18% to 59% of total deposits, from 55% a year ago. This led total deposits to grow 9% year-on-year to PHP569 billion.
Net lending grew 15% year-on-year to PHP490 billion, driven by wholesale lending which grew 18% and retail lending which grew 6%. Personal loans represent 23% of total loans compared to 26% a year ago.
On a sequential quarterly basis, net lending increased 5%, with wholesale and retail lending growing 6% and 4%, respectively. Low cost savings and demand deposits increased by 4% and total deposits increased by 7%.
Security Bank continues to be among the best capitalized domestic private universal banks in the country. The Common Equity Tier 1 ratio was 16.7% and the Total Capital Adequacy (CAR) ratio was 17.2%. Total assets increased to PHP 766 billion, up 9% year-on-year. The registered capital amounted to PHP 124 billion.
“We are very pleased with the continued improvement in our core business. Our growth in loans and investment securities is a tangible manifestation of our commitment to our clients to support the reopening of the economy and weather the storm. impact of inflation.” – President and CEO of Security Bank, Sanjiv Vohra.
About Security Bank
Security Bank is a private national universal bank in the Philippines with total assets of PHP 766 billion as of June 30, 2022. The Bank has been operating for 71 years since its establishment in 1951. Security Bank has a total of 316 branches and 657 ATMs. nowadays.
Security Bank was recently awarded in April 2022 with “Best for Mass Attendance / HNW in the Philippines 2022“rewarded by Asiamoney. The main citations of the Bank in 2021 are: The Best Bank in the Philippines by Euromoney; Ideal for HNW (high net worth clients) in the Philippines by Asiamoney; Best Retail Bank in the Philippines by Alpha Southeast Asia; and Top Learning Culture and Diversity Champion by LinkedIn Talent Awards.
The main prizes in 2020 are: The strongest bank in the Philippines in 2020 by The Asian banker; Best Bank in the Philippines for 2020 by The Lafferty Group (The Statement Magazine); and Best Retail Bank in the Philippines in 2020 by Alpha Southeast Asia.
The main awards received in 2019 are: The Best Retail Bank in the Philippines by The Asian banker and Deposit Product of the Year – “All Access Account” by The Asian banker; Car Loan Product of the Year by The Asian Banker (Philippines Awards 2019) and Deposit Product of the Year by The Asian Banker (Philippine Awards 2019); Best bank in the Philippines by Alpha Southeast Asia and Best Bank for SMEs in the Philippines by Alpha Southeast Asia; and Best Bank for SMEs in the Philippines by Asiamoney.
More information is available at www.securitybank.com.