First Metro Investment Corp. (PSE: FMIC), the investment banking arm of the Metrobank Group (PSE: MBT), continues to surge as it closed the year with a consolidated net income of PhP1.7 billion or 67.8% higher than the PhP1 billion consolidated net income of the previous year. Year on year return on equity is at 18.6%.
This year’s success could be attributed to the outstanding performance of all strategic business units.
The Treasury Group alone made a solid PhP968.9 million net income, up 45.5% from last year. Net interest income from Treasury portfolio is PhP955.9 million, driven by higher level of securities portfolio and lower cost of fund. Gain from trading of government securities is PhP953.2 million, 149.1% higher than last year, while fee income from securities distribution is PhP118.4 million, 48.2% higher than last year. Finally, non-interest expenses incurred by Treasury Group amounted to PhP708 million.
The Investment Banking Group made a record net income of PhP252.8 million, an increase of 25.7% from the previous year’s fees. The bulk of this revenue was generated through various significant deals that included Power Sector Assets and Liabilities Management Corp.’s (PSALM) PhP30 billion Retail Treasury Bond, Beacon Electric Assets Holdings Inc.’s PhP18 billion capital notes, Panay Energy Development Corp.’s PhP14 billion project loan facility, and Home Development Mutual Fund’s (PAG-IBIG) PhP12 billion bond issue, among others.
The Corporate Lending Department, on the other hand, earned a net income of PhP185.1 million which is 160.6% more than the previous year.
The Investment Advisory Group (IAG) also made an excellent performance with a net income of PhP269.3 million in trading gains and dividends from investment in stocks. This is 38% or PhP74.2 million above their 2009 net income of PhP195.1 million. Aside from an outstanding stock performance, the IAG also garnered the top spot in the performance of the equity and balanced mutual funds. The Save & Learn Equity Fund showed a 63% return, much higher than the rise in the Philippine Stock index of 37% for 2010.
FMIC’s consolidated total assets at the end of the year amounted to PhP64.0 billion, 7.4% more than the year-end balance in 2009 of PhP59.6 billion. Capital funds reached PhP9.9 billion, 15.2% higher than the 2009 year-end level.
FMIC’s President Francisco Sebastian expects the momentum of 2010 to be sustained in 2011 with the economic growth at around the 7% level, inflation at 4%, and overseas remittance continue to grow at about 7%. He also anticipates the local financial market to remain on an upbeat and buoyant mode, led by the stock market.