RCBC net profit up 77% to ₱2.3 B in Q1

Published May 4, 2020, 12:00 AM

by manilabulletin_admin

By James A. Loyola

Rizal Commercial Banking Corporation (RCBC) sustained its strong momentum in the first quarter of 2020 with a 77 percent year-on-year growth in net income ₱2.3 billion despite the impact of the COVID-19 pandemic.

In a disclosure to the Philippine Stock Exchange, the bank said the robust performance of its core business and trading gains boosted the bottom line.

Its annualized Return on Equity (ROE) improved to 11.1 percent and annualized Return on Assets (ROA) to 1.28 percent.

RCBC’s gross revenues grew by 23 percent year-on-year to ₱10.0 billion as net interest income and non-interest income rose by 19 percent and 29 percent, respectively.

Interest income from loans and receivables grew by 12 percent on the back of strong volume growth and sustained margins across all customer segments.

In addition, cost of funds declined by 71 basis points as the market interest rates normalized during the quarter. Non-interest income also increased by 29 percent, accounted for by higher trading and foreign exchange gains.

Furthermore, operating efficiency improved with a cost-to-income ratio of 55.6 percent, better than the 64.2 percent registered last year.

The Bank’s small and medium enterprises (SME) and consumer loan segments have registered pre-COVID growth of 26 percent and 20 percent, respectively.

The credit card business also expanded, with credit card receivables accelerating by 42 percent, and card base of 914,000 reflecting a 25 percent year-on-year growth. For clients with credit facilities and loans, the bank has implemented a payment reprieve during the enhanced community quarantine.

The Bank’s net non-performing loan ratio as of March was at 2.2 percent, slightly better than the 2.6 percent recorded in the same period last year.