MANILA, Philippines — The Metropolitan Bank and Trust Co. jacked up its nine-month net profit by 47.6 percent year-on-year to P8.9 billion as higher interest income and fee-based earnings offset slower treasury gains.
For the July to September period alone, net profits jumped by 52.8 percent to P2.8 billion compared to the third quarter of last year.
The robust nine-month performance brought the bank’s annualized return on equity to 12.3 percent from 10 percent a year ago, Metrobank disclosed to the Philippine Stock Exchange on Monday.
“Our numbers continue to reflect our long-term strategy of managing balance sheet strength and solid earnings growth. We closely monitor developments in the global markets, while looking for opportunities that will help strengthen our position in a competitive domestic environment,” Metrobank president Arthur Ty said in a press statement.
“Our capital position remains strong, asset quality is in check and core revenues are growing sustainably,” Ty added.
The bank expanded its total operating income by 4.4 percent to P37.7 billion, aided by a 7.3-percent growth in net interest income to P21.5 billion compared to a year ago. This was because the bank extracted slightly better margins compared to a year ago despite stiff competition. It also expanded its earning assets and improved its funding mix.
Metrobank grew its loan book by 14.8 percent to P432.8 billion, taking advantage of the resilient domestic economy by growing by double-digit its lending to corporate, middle market/small and medium enterprises and consumer sectors.
On the deposit-taking side, the ratio of low-cost deposits was raised to 51.7 percent from 46.2 percent in 2010.
Fee-based earnings likewise contributed to higher operating income as the bank grew income from service charges, fees and commissions by 10.8 percent to P5.8 billion. There was likewise a 17.6- percent growth in trust income and profits from assets sold.
As widely expected this year, trading and foreign exchange gains slowed down to P6 billion from a year ago. No comparative figure was given.
On the expenditure side, Metrobank’s operating expenses grew by 8.9 percent to P22.5 billion due to higher manpower and occupancy costs. On the other hand, provisions set aside for credit losses amounted to P2.3 billion, 57.5 percent lower year-on-year.
In terms of asset quality, the stock of bad loans as a ratio of total loan portfolio lessened to 2.5 percent from 3.1 percent a year ago while non-performing loan coverage likewise increased lessened from 95.9 percent to 87.5 percent.
The bank ended September with total assets of P916.1 billion, making it the second largest in the country in terms of resources. However, it remained the bank with the highest capitalization at P104.2 billion.
Total capital adequacy ratio (CAR) to risk assets stood at 16.9 percent, much higher than banking regulators’ minimum requirement of 10 percent. Counting only the core or tier 1 capital, the CAR stood at 13.2 percent.