SECURITY BANK Corp. saw its net profit rise by 7% year on year in the first quarter, driven by higher revenues.
The bank’s net income was at P2.82 billion in the first three months, rising from P2.63 billion in the comparable year-ago period, it said in a disclosure to the stock exchange on Thursday.
This translated to a return on average equity of 7.92%, up from 7.71% a year prior. Return on average assets went down to 1.01% from 1.20%.
“Our first quarter was marked by the growth on our deposit and loans. Profitable growth is our focus for 2025. We will continue to support our clients, deploy innovative technology to deliver differentiated client experiences, and enhance efficiencies to generate improved returns,” Security Bank President and Chief Executive Officer Sanjiv Vohra said.
The bank’s revenues increased by 23% year on year to P15.4 billion.
Broken down, net interest income rose by 11% to P11.88 billion in the first quarter from P10.73 billion.
Interest income grew to P18.65 billion from P13.92 billion, mainly driven by higher interest earnings on loans. Interest expense also increased to P6.76 billion from P3.19 billion on higher spending for deposits due to elevated interest rates.
This resulted in a net interest margin of 4.51% in the three months ended March, down from 5.32% a year prior.
Non-interest income surged by 101% to P3.5 billion from P1.8 billion, mainly due to increases in its foreign exchange and trading gains and miscellaneous earnings.
The rise in the bank’s other income also came even as service charges, fees and commissions went down to P2.16 billion from P3.1 billion due to a one-off bancassurance milestone fee realized in the same period the year prior.
“Excluding the milestone fee, service charges, fees and commissions increased 27% year on year.”
Meanwhile, the bank’s operating expenses climbed by 23% year on year to P11.72 billion, which it said was “driven by investments in manpower and technology to accelerate transformation.”
The bank set aside higher provisions for credit and impairment losses at P2.4 billion from P1.5 billion a year prior to reflect its “proactive stance towards the current economic environment.”
Its cost-to-income ratio inched down to 60.59% from 60.74% a year prior.
Security Bank’s net loans grew by 18% year on year to P646 billion at end-March.
“Retail and MSME (micro, small and medium enterprise) loans increased 37% year on year while wholesale loans increased 11% year on year. On a sequential quarter-on-quarter basis, retail and MSME loans combined increased 6%, while wholesale loans decreased 10%,” it said. “Retail and MSME loans as percent of total loans was at 36%, up from 31% a year ago.”
Its gross nonperforming loan (NPL) ratio was at 3.1%, down from 3.41% a year ago. NPL reserve cover stood at 78.97%.
Meanwhile, total deposits increased by 32% year on year to P841 billion as its current and savings account or CASA deposits rose by 19% and made up 50% of the total.
The bank’s assets expanded by 25% year on year to P1.1 trillion at end-March. Shareholders’ capital also increased by 5% to P144 billion.
Its common equity Tier 1 ratio went up to 13.2% as of March from 12.94% at end-December, while its capital adequacy ratio rose to 14.07% from 13.84%.
“The bank maintains healthy liquidity, with liquidity coverage ratio at 179% and net stable funding ratio at 136% as of March 31,” it added.
Security Bank has a total of 348 branches and 710 automated teller machines, cash recycler machines and cash acceptance machines to date.
Its shares went down by P2.25 or 3.25% to close at P66.90 each on Thursday.
