PSBank books higher net profit in first half on interest earnings

PHILIPPINE SAVINGS Bank (PSBank) reported higher net earnings in the first half of the year on the back of strong net interest income and service fees.
In a disclosure to the local bourse on Thursday, the consumer lending arm of Metropolitan Bank & Trust Co. (Metrobank) saw its net profit climb to P1.35 billion in the January-June period, up 14.7% from P1.18 billion in the same period last year.
PSBank attributed the result to “robust revenues driven by net interest income and service fees.”
The bank’s net interest income grew 8.8% to P5.85 billion from last year’s P5.38 billion.
Meanwhile, its total loan portfolio expanded by 10.7% to P151.62 billion from the P137.01 billion booked in the previous year.
Deposits likewise stood at P200.09 billion, 9% higher from the year-ago period.
PSBank’s earnings translated to a return on equity of 11.83%, it said.
Its common equity Tier 1 ratio stood at 11%, while its capital adequacy ratio was at 13.7%, above the regulatory minimum.
Overall, the bank’s total assets stood at P234.76 billion, up 7.4% from the same period last year.
In the statement, PSBank President Jose Vicente L. Alde said the lender’s first half performance is a result of its institutional strategy by providing end-to-end customer experience.
“We have likewise tapped on the latest available digital technology to improve on process efficiencies to bring the cost of operations down while maximizing the full potential of our sales distribution channels in generating more business for the bank,” Mr. Alde was quoted as saying in the regulatory filing.
LTNCD
Meanwhile, PSBank raised P5 billion from the first tranche of its long-term negotiable certificates of deposit (LTNCD) program, which it wants to use to expand its consumer banking segment.
According to a document posted on the Philippine Dealing System Web site, the Ty-led savings bank raised P5.0845 billion from the peso-denominated issue, higher than the initial plan of P3 billion. The notes will mature in five years and six months and carry an interest rate of 5% to be paid quarterly.
PSBank said in a previous disclosure that its board of directors approved the issuance of up to P15 billion worth of LTNCDs. The offerings will be conducted over a year in two or more tranches.
LTNCDs are similar to regular time deposits which offer higher interest rates but cannot be pre-terminated.
In a previous interview, PSBank’s chief executive said the proceeds of the fund-raising activity will be used to expand its consumer banking segment brought about by its “robust” growth.
“[Proceeds of the fund will go to the] expansion of the consumer business,” Mr. Alde said in June. “We have been growing our consumer business for past years, and we still expect the consumer business to be robust in the next years, so we’re preparing for that expansion.”
ING Bank, N.V. and Standard Chartered Bank served as joint lead arrangers and bookrunners of the issue, while First Metro Investment Corp., Metrobank and PSBank served as selling agents.
Apart from PSBank, Robinsons Bank Corp., China Banking Corp. and East West Banking Corp. have recently issued LTNCDs to support its funding needs. — Karl Angelo N. Vidal