SECURITY Bank Corp, posted a net income of P4.657 billion in net income in the first half of 2015, representing 29 percent year-on-year growth and 19 percent return on shareholders' equity (ROE).
This result was driven by healthy growth in the bank's core businesses, with loan growth of 20 percent year-on-year to P207 billion and deposit growth of 18 percent to P257 billion, which fuelled a 15 percent year-on-year increase in the bank’s total assets to P442 billion.
Loan growth was broad-based, with corporate/commercial loans growing by 18 percent while consumer loans surged by 90 percent. The loan-to-deposit ratio was 81 percent. The return on assets (ROA) was 2.2 percent.
Interest income on loans increased by 17 percent year-on-year, which contributed to total interest income growth of 11 percent year-on-year.
Interest expense increased by 46 percent year-on-year, reflecting the expected effect of the longer-term funding that the Bank issued such as the P10 billion Basel III compliant Tier 2 capital in July 2014 and the USD 300 million senior unsecured notes in February 2015.
As a result, net interest income was at P5.8 billion, same level as year-ago. Net interest margin was 3.2 percent in 1H-2015, versus the 3.4 percent average in 2014.
Non-interest income increased by 69 percent to P4.4 billion, which included extraordinary trading gain of P2.1 billion. Excluding extraordinary trading gain, non-interest income was P2.3 billion, 58 percent increase year-on-year. Trading gains from trading portfolio and customer flows amounted to P906 million in 1H-2015. Fee-based income inclusive of asset management was P947 million, 11 percent increase year-on year.
Security Bank's total operating income increased by 22 percent year-on-year to P10.2 billion. Operating expense (excluding provisions for credit losses and impairments) grew by 28 percent due to taxes incurred from the sale of securities in Q1-2015, and marketing and advertising expenses in support of the Bank's retail banking strategy. Security Bank had a network of 257 branches and 532 ATMs as of June 30, 2015.
For the three-month period ended June 30, 2015, Security Bank earned P1.3 billion in net income. Interest income on loans increased by 4 percent quarter-on-quarter which contributed to the 2 percent quarter-on-quarter growth in total interest income.