First Metro Investment nets P2.3 B in 1st Q

MANILA, Philippines—First Metro Investment Corp., the investment banking arm of the Metrobank group, jacked up its first quarter net profit by 134 percent year-on-year to P2.3 billion, boosted mostly by treasury earnings.

This translated to a rich return on equity of 56.2 percent.  FMIC said in a press statement on Tuesday that aside from hefty treasury earnings, FMIC’s other business segments like investment banking, strategic finance and investment advisory also posted substantial growth.

“We are very happy with our first-quarter results as this is one of the best quarters we’ve had in years. This early, all our strategic business units contributed significantly to our bottom line. We attribute our good performance to the country’s favorable macroeconomic environment that opens up a lot of opportunities and allows us to strengthen our franchise and continuously deliver unmatched services to our clients,” FMIC president Roberto Juanchito Dispo said.

FMIC’s treasury group was the biggest income earner for the period with P1.1 billion, 126-percent higher than the profit level this segment made in the same period last year. The statement said this was generated from interest income from fixed income portfolio, trading gains from the sale and redemption of government and private securities as well as fee income from securities distribution.

The investment banking group generated a total fee income of P168 million, double the level earned in the same quarter last year. The notable deals in which FMIC participated were: Beacon Electric Asset Holdings’s P17-billion corporate notes issue; Megawide Construction Corp.’s P4-billion notes facility agreement; Philippine Business Bank’s P3.19 billion initial public offering; GT Capital Holdings’ P10-billion fixed rate bonds; and Toledo Power Co.’s P7-billion project loan facility.

The strategic finance unit registered P96 million in earnings, likewise more than double the P42 million earnings in the same period last year.

The investment advisory group posted a total income of P216 million in net trading gains and dividend income from investments in stocks. This marked a 232-percent surge from the level in the same period last year.

The investment bank’s consolidated assets stood at P86.5 billion.

“In January this year during the Philippine Investment Summit, Dr. Nouriel Roubini boldly declared that the Philippines deserves to be investment grade and in less than two months, Fitch gave us our first ever investment grade credit rating. With this encouraging take-off and as our country continues to show a remarkable growth performance; much improved fiscal position; massive liquidity inflows; benign inflation; and an equities market that continues to soar and roar, the rest of the year certainly looks very positive for the domestic capital markets, which we intend to take advantage of,” Dispo added.