By James A. Loyola
Metropolitan Bank & Trust Company (Metrobank) posted a 21 percent growth in net income to P22.0 billion last year from the P18.2 billion registered in 2017 as total resources reached a new all-time high of P2.2 trillion.
(Photo courtesy of metrobank.com.ph)
In a disclosure to the Philippine Stock Exchange, Metrobank said its strong performance was driven by the healthy growth in loans complemented by margin expansion, higher service charges, fees and commissions, and manageable expense growth.
Metrobank President Fabian S. Dee said “2018 was a milestone year for our bank. Despite the challenging market conditions that especially characterized the second half of the year, we achieved consistent core income growth while keeping operating costs in check and asset quality intact.”
“In addition, we have been steadily laying the groundwork for future expansion through structural changes, and focusing on productivity and efficiency improvements across the institution,” noted Dee.
The Bank’s loan portfolio expanded by 10 percent year-on-year to P1.4 trillion. The commercial book led the growth at 11 percent, driven by the top corporate accounts, followed by the middle market and SME accounts.
Total deposits increased by 2 percent to P1.6 trillion at the end of 2018, while the Bank’s CASA ratio was maintained at 62 percent.
Funding was supplemented by the issuance of P8.68-billion Long- Term Negotiable Certificates of Deposits (LTNCDs) in October, and P28.0-billion Fixed Rate Peso Bonds in November and December.
As a result, net interest income expanded by 12 percent to P68.8 billion, and accounting for 74 percentof the Bank’s total revenues of P92.6 billion. Net interest margin expanded to 3.82 ercent, still the highest among peer banks.
Meanwhile, total non-interest income grew to P23.8 billion. The major drivers are service fees and commissions and income from trust operations which combined went up by 13 percent to P14.0 billion.
Fee-related revenues were boosted by steady customer-driven flows and trade-related commissions. In addition, net trading and FX gains contributed P2.8 billion while other income was at P6.2 billion.
Asset quality metrics remained healthy and better than industry average. Non-performing loans (NPLs) ratio was recorded at 1.2 percent, while NPL cover increased to 105 percent.
Overall credit cost was kept well-within the company’s guidance of 50 to 60 basis points for the full year. The Bank reported provisions for credit and impairment losses of P7.8 billion, which is already based on PFRS 9 adopted at the beginning of the year.
As of December 2018, Metrobank’s consolidated assets stood at P2.2 trillion and equity at P283.0 billion.