Security Bank posts higher profit in 2nd quarter
SECURITY BANK Corp. posted a higher net profit in the second quarter on the back of improved net interest income and higher trading gains.
The lender’s net income increased 8% year on year to P2.8 billion in the April to June period, it said in a disclosure to the local bourse on Thursday.
Revenues surged 61% to P12.6 billion in the quarter. Excluding trading gains, total revenues increased 20% to P8.9 billion.
This brought the bank’s first semester net income to P5.7 billion, up by 14% year on year, the statement said.
“The bank set aside P11 billion as provisions for credit losses in H1 2020, a significant increase versus P639 million in H1 2019, which reflects the bank’s proactive provisioning and anticipates a challenging economic environment brought about by the pandemic,” Security Bank said in its statement.
Net interest income in the second quarter climbed 27% year on year to P7.8 billion. Meanwhile, non-interest income surged 183% to P4.9 billion.
Gains from securities trading also ballooned to P3.7 billion from P376 million a year ago.
Security Bank’s net interest margin increased 103 basis points year on year to 4.64% in the second quarter.
Meanwhile, operating expenses slipped 3% in the three months ended June compared to the first quarter as the bank controlled its spending even while growing its digitization, contact center and collection infrastructure.
Security Bank’s total deposits stood at P511 billion at end-June, a 14% increase from the year-ago level. This, as low-cost savings and demand deposits grew 27% to comprise 48% of the total.
Meanwhile, loans without SB Finance’s portfolio rose 7% to P450 billion. Retail loans, which made up 27% of the bank’s portfolio, grew 25%, while wholesale loans rose 4%.
“As we expect the impact of the pandemic on our loan portfolio will continue to unfold over the coming quarters, we have adopted a proactive stance on our provisions,” Security Bank President and Chief Executive Officer Sanjiv Vohra was quoted as saying.
Total assets slipped 5% year on year to P740 billion while shareholders’ capital jumped 11% to P127 billion.
Capital adequacy ratio and common equity Tier 1 ratio stood at 19.7% and 18.8%, respectively, both higher than the required levels.
The bank had 309 branches and 820 automated teller machines as of June 30.
Security Bank’s shares closed at P95.90 per piece on Thursday, gaining P3.10 or 3.34% from its previous finish. — Luz Wendy T. Noble
