Metrobank to pay record dividends as 2023 earnings post 29% growth

MANILA, Philippines  —The Ty family-led Metropolitan Bank & Trust Co. (Metrobank) will pay record dividends of P22.5 billion to stockholders after achieving historic high earnings the past year.

Metrobank, the country’s second-largest private bank, reported a significant boost in its net income for 2023, reaching P42.2 billion, which marks a 28.9-percent increase over 2022, a stock exchange filing on Thursday showed.

This translated to a return on equity of 12.5 percent, higher than the 10.3 percent recorded in the previous year.

Metrobank’s board of directors also approved a total cash dividend of P5 per common share, the highest in its history.

The lender increased its regular cash dividend to P3 each and added a P2 per share special dividend for its stockholders. The initial disbursement of P3.50 is set for March 25 for stockholders on record as of March 8. A second payment of P1.50 is slated for September 2024.

Higher margins, improved efficiency

Metrobank President Fabian S. Dee said gains for the year were driven by “asset expansion, higher margins, improving efficiency levels and better asset quality”.

“This indicates that we are firmly on track with our long-term growth strategies supported by our highly capable and resilient team of Metrobankers and strong balance sheet,” Dee said.

In 2023, Metrobank said total assets grew by 9.2 percent to P3.1 trillion as gross loans increased by 7.6 percent. Within its loan portfolio, consumer loans jumped 15.9 percent while commercial loans grew 5.5 percent, signaling a robust consumer market.

READ: Metrobank keeps income growth momentum in H1

This also pushed up its net interest income by 22.7 percent while the bank’s net interest margin reached 3.9 percent. On the other hand, fee-based income grew by 9 percent to P16.4 billion while trading and foreign exchange gains were flat at P4 billion.

Bad loans ratio down to 1.7%

Metrobank also noted an improvement in asset quality, with its non-performing loans ratio easing to 1.7 percent from 1.9 percent in 2022—both well below the industry’s 3.3 percent NPL ratio. Its NPL cover stood at 180.3 percent, reflecting its conservative stance.

Total deposits the past year added 7.3 percent to P2.4 trillion with 60 percent coming from low-cost current and savings accounts deposits. Its cost to income ratio thus ended the year at 52.1 percent, which was better than 54.3 percent in 2022.

Metrobank’s total equity stood at P356.7 billion, while capital ratios remain to be one of the highest in the industry, with capital adequacy ratio at 18.3 percent and common equity tier 1 ratio at 17.4 percent, above the minimum regulatory requirements.