Metrobank net profit jumped 57% in Q3

Local banking giant Metropolitan Bank and Trust Co. grew its third-quarter net profit by 57 percent year-on-year to P4 billion on better than-expected lending business alongside one-time gains from property divestment and sale of noncore assets.

For the nine-month period, Metrobank’s net profit amounted to P13.1 billion, 34.8-percent lower than the level in the same period last year, which was marked by extraordinary trading gains and bigger asset disposals in line with tighter capital adequacy ratio requirements under the Basel 3 framework.

Net interest income grew by 23 percent year-on-year to P34 billion in the first nine months, contributing 64 percent to Metrobank’s P53 billion in total operating income for the period. This was attributed to better-than-expected growth in loans and deposits alongside relatively healthy spreads.

“The robust core income growth reflects positively on our strategy. Our thrust is to maximize returns from traditional revenue sources while prudently managing balance sheet growth,” Metrobank president Fabian Dee said in a statement.

Jette Gamboa, senior vice president and head of strategic planning at Metrobank, said the net interest margin of 3.8 percent—one of the highest in the industry—had been stable in the last eight quarters. Moving forward, she said there was a possibility that margins could firm up as local interest rates rise from record lows.

The bank grew its loan book by 21 percent year-on-year to P697.3 billion in the first nine months, ahead of its full-year guidance of 15-18 percent target.

The robust loan growth was supported by a 23 percent year-on-year growth in deposits to P1.1 trillion in the first nine months. This was faster than the original goal of 12-15 percent growth in deposit base for this year.

Challenged by a record-high net profit base last year, Gamboa said the bank mitigated the impact by rebuilding net interest income. “It’s the back-to-basics strategy of focusing on net interest income,” Gamboa said.

Nonrecurring items booked by Metrobank in the first nine months included the sale of some idle property assets as well as the disposal of the stake in Charter Ping An (to parent GT Capital) and Toyota Financial, said Metrobank vice president and head of investor relations Juan Placido Mapa III. Doris C. Dumlao