Security Bank seeks to sustain high ROE

Security Bank Corp. aims to sustain this year a return on equity of at least 20 percent even in the absence of extraordinary trading gains seen in 2010.

In an interview, SBC chief finance officer Carlos Borromeo said the bank was cognizant that the big amount of nonrecurring earnings from trading gains last year could not be replicated in 2011. However, he said the bank was growing its loan book precisely to boost recurring earnings this year.

SBC chalked up a record-high net profit of P7.2 billion in 2010, up 134 percent from the previous year on the back of large treasury gains. This translated to a record 35-percent return on equity, outperforming most of its banking peers.

“We’re not expected to repeat that kind of ROE,” Borromeo said.

But the bank executive said it was feasible for the bank to sustain its track record of posting at least a 20-percent ROE each year.

In the first quarter, loan growth expanded by about 26 percent as the bank sought to grow quality assets. The fastest-growing were the small and medium enterprise segments, he said.

The bank is also expected to participate actively in funding infrastructure projects under the public-private partnership framework of the Aquino administration.

Asked whether SBC was looking for other banks to acquire, Borromeo said: “Acquisition is a matter of valuation. I’m always the jilted lover. It’s not for lack of trying but we have very stringent parameters.”—Doris C. Dumlao