MANILA, Philippines--The Metrobank group's investment house, First Metro Investments Corp. posted a 25-percent decline in first-quarter net profits to P140 million as trading on both equities and government securities remained cautious, given the fiercely volatile financial markets.

Its treasury group contributed most of the company’s income, benefiting from trading gains realized from sale of government securities, which made up for a negative spread on its fixed income portfolio due to high deposit rates at the end of 2008 and early into the current year.

But FMIC director and executive vice president Roberto Juanchito Dispo assured that “ … as short term rates declined, interest spread turned positive in March onwards.” He expressed hopes this could be maintained for the rest of the year.

The company’s investment banking business accelerated with fees rising by 12 percent to P83 million compared to 2008. FMIC said it continued to churn out deals driven by prime local corporates’ strong appetite for debt financing through the local capital market.

Among the deals completed for the quarter include bonds and notes issuances for some of the country’s top corporations, namely Ayala Land Inc., Philippine Long Distance Telephone Co., Globe Telecom, Metrobank Card, Ayala Corp., and Philippine National Bank.

FMIC's total resources at the end of March stood at P45.4 billion, slightly higher than P44.2 billion at yearend. “We maintained a very high liquidity for statutory and legal reserves as well as market opportunities,” FMIC president Francisco C. Sebastian said.

Capital funds ended at P5.6 billion as of March 31, 2009, translating to a 19.63-percent capital adequacy ratio, way above the minimum requirement of 10 percent.