SUN Savings Bank generated significant growth of 42 percent in its total assets to reach P1.7 billion for the first quarter of this year compared to the same quarter last year of P1.2 billion.
Loan portfolio level correspondingly grew by 46 percent to P1.442 billion compared to last year’s level of P988 million. Total deposits grew by 58 percent to P1.145 billion compared to last year’s figure of P726 million.
The growth of the bank’s deposits was mainly driven by its rewarding time deposit products. The bank’s five-year time deposit with an interest rate of seven percent per annum tax-free, and interest paid in advance for one year, continues to attract more depositors who are looking for bigger rewards. This time deposit product is the best deal in Cebu, higher than the after tax yields of 5.09 percent to 5.74 percent per annum rates recently offered by a universal bank and top corporations for debt instruments of similar maturities.
The bank’s net interest income of P37 million for the first quarter of 2019 increased by 86 percent compared to the same quarter a year ago. This was made possible as the bank also recorded a record net interest margin (NIM) of 9.32 percent for the first quarter of 2019. The bank’s NIM also compared favorably with the 5.5 percent NIM attained by the thrift bank industry in 2018.
The bank maintained the quality of its loan portfolio as its non-performing loan (NPL) ratio as of March 2019 was steady at 1.77 percent, even as its loan portfolio grew significantly during the quarter.
Cost-to-income ratio continued to improve to 56.4 percent as of the first quarter, lower than the 66.9 percent ratio of the thrift bank industry in 2018. A low cost-to-income ratio is an indicator of how a bank efficiently controls the level of its operating expenses in relation to revenues generated.
The bank’s capital adequacy ratio (CAR) as of March 2019 was at 22.45 percent, way above the 10 percent minimum CAR required by the Bangko Sentral ng Pilipinas.
Recently, Sun Savings Bank was granted a P200 million credit line by the Land Bank of the Philippines to support the bank’s lending activities to small and medium enterprises (SME) engaged in agri-value chain activities, such as food processing, trading and transport of agricultural products.
With the expected opening of another banking office in Carbon market in Cebu City by the first half of 2019, the bank will be strategically positioned to offer loans to the SMEs engaged in agri-value chain activities. (PR)