Security Bank Posts PhP1.6B Net Income in Q1-2021
Security Bank Corporation (PSE: SECB) posted net profit of PhP 1.6 billion in the first quarter of 2021. The passage of the CREATE law triggered a one-time PhP 1.2 billion charge for deferred tax assets. Profit before tax was PhP 3.3 billion, up 42% from the same period last year.
Total net interest income was PhP 6.6 billion, down 18%. Net interest margin in Q1-2021 was 4.39%, down 29 basis points year-on-year. Total non-interest income decreased 58% to PhP 2.1 billion. Securities trading gains were PhP 689 million, 80% lower than PhP 3.5 billion a year ago.
Service charges, fees and commissions were up 1% to PhP 1.1 billion, with bancassurance, credit card, stockbrokerage and miscellaneous fees increasing from year-ago levels.
Operating expense decreased 3% from the same period last year. The cost-to-income ratio was 57.6%.
The Bank set aside PhP 402 million as provisions for credit losses in Q1-2021, 93% lower than PhP 5.7 billion in Q1-2020. Gross non-performing loan ratio decreased to 3.41% from 3.90% a quarter ago. NPL reserve cover was 118%, up from 115% a quarter ago.
Return on shareholders’ equity was 5.38%.
Balance sheet remains strong
Low-cost savings and demand deposits increased 12% from year-ago level. High-cost deposits decreased 5%. Total deposits increased 3% year-on-year to PhP 519 billion.
Gross loans stood at PhP 450 billion, down 5% from year-ago level. Gross retail loans decreased 12% year-on-year, and account for 25% of total loans, while wholesale loans decreased 2%.
Security Bank continues to be among the country’s best capitalized private domestic universal banks. Common Equity Tier 1 Ratio was 19.2%, up from 16.5% a year ago. Total Capital Adequacy Ratio (CAR) was 20.1%, up from 17.6% a year ago. Total assets stood at PhP 718 billion, down 9% year-on-year. Shareholders’ capital was at PhP 121 billion, up 1%.
Security Bank declared cash dividends on March 30, 2021 with payment date on April 29, 2021 amounting PhP 1.50 per common share, representing regular semestral cash dividend of PhP 1.00 per common share and a special cash dividend of PhP 0.50 per common share.
“Our team’s focus on clients remains steadfast. We are hopeful that progress on vaccination in the coming quarters will help the country resume its growth trajectory. We are fortunate that our strong capital equips the Bank to support clients directly through loans and indirectly through
significant investments in both our team and our technology to improve customer experience.” — Security Bank President & CEO, Sanjiv Vohra.