Higher expenses pull down RCBC earnings

Higher costs pulled down the net profit of Yuchengco-led Rizal Commercial Banking Corp. (RCBC) by 31 percent to P6.2 billion in the first nine months of the year despite a bigger loan portfolio.

In a stock exchange filing on Thursday, RCBC said net interest income expanded by 27.6 percent to P30.93 billion, driven by a growth in the consumer segment, particularly auto loans.

READ: RCBC expands offshore borrowing program to $4B

“The bank’s ability to combine its core strengths with its innovative digital platforms has been key to the growth of the consumer loan portfolio,” RCBC said, adding that consumer loans represented 39 percent of its total consumer portfolio.

However, the bank noted a 16.1-percent increase in interest expense to P27.6 billion tempered overall growth. This was on the back of higher costs on deposit liabilities, RCBC’s financial filing showed.

Other operating income slipped by 41.6 percent to P6.84 billion due to lower foreign exchange gains.

Assets at P1.3T

RCBC, the country’s sixth largest bank, pointed out its core income rose by 28 percent due to loan expansion and a “general improvement in yields.”

As of end-September, its assets stood at P1.3 trillion. It now has 463 branches and 1,482 automated teller machines across the country.

RCBC has partnered with instant payment provider Higala Group Inc. to launch open payment platform SynerFi to improve digital banking accessibility in rural areas.

According to RCBC, rural banks and microfinance institutions will be able to offer digital transactions to their customers through SynerFi and InstaPay.

Under the partnership, Higala will provide the digital platform, while RCBC will act as the sponsor bank and manage regulatory requirements, including compliance, clearing and settlement.—Meg J. Adonis