Security Bank Q3 profit hits P2.25B

Security Bank Corp. grew its third quarter net profit by 5 percent year-on-year to P2.25 billion as the bank expanded its higher-margin consumer lending activities while growing its low-cost deposits.

This brought its nine-month net profit to P6.5 billion, down by 11 percent year-on-year, as lower trading gains tempered earnings in the first semester.

For the third quarter alone, Security Bank disclosed to the Philippine Stock Exchange on Monday that consumer loans grew by 48 percent year-on-year while low-cost deposits increased by 18 percent.

Total loans ended the period at P401 billion, of which consumer loans accounted for 19 percent compared to 14 percent a year ago.

On the funding side, total deposits improved by 9 percent to P468 billion, with high-cost deposits inching up by 3 percent.

Net interest income from customer loans and deposits for the quarter increased by 23 percent year-on-year. Net interest spread on loans and deposits increased by 16 basis points from the previous quarter to 4.43 percent. Compared to a year ago, the margin improved by 11 basis points.

For the nine-month period, the 11-percent year-on-year drop in net income was attributed to the decline in trading gains by 57 percent or P627 million alongside the increase in provision for income tax by 73 percent or P769 million.

Nine-month net interest income from customer loans and deposits increased by 30 percent to P11.3 billion while interest income from financial investments slipped by 13 percent due to the 18-percent year-on-year reduction in its securities portfolio.

Overall net interest margin improved to 3.3 percent in the third quarter, up by 11 basis points quarter-on-quarter and up by 7 basis points year-on-year. —DORIS DUMLAO-ABADILLA