Security Bank Corporation reported that its net profit dipped 10 percent to P1.6 billion in the first quarter of 2021 from the P2.9 billion earned in the same period last year.
In a disclosure to the Philippine Stock Exchange, the bank said the decline was due to the passage of the CREATE law which triggered a one-time P1.2 billion charge for deferred tax assets.
Profit before tax was P3.3 billion, up 42 percent from the same period last year.
Total net interest income for the first quarter of 2021 was P6.6 billion, down 18 percent, as net interest margin was 4.39 percent, down 29 basis points year-on-year.
Total non-interest income decreased 58 percent to P2.1 billion with securities trading gains falling 80 percent to P689 million from the P3.5 billion a year ago.
Service charges, fees and commissions were up 1 percent to P1.1 billion, with bancassurance, credit card, stockbrokerage and miscellaneous fees increasing from year-ago levels.
Operating expense decreased 3 percent from the same period last year. The cost-to-income ratio was 57.6 percent.
The Bank set aside P402 million as provisions for credit losses in the first quarter of 2021, 93 percent lower than the P5.7 billion in in the same period last year.
Gross non-performing loan ratio decreased to 3.41 percent from 3.90 percent a quarter ago. NPL reserve cover was 118 percent, up from 115 percent a quarter ago.
Low-cost savings and demand deposits increased 12 percent from year-ago level while high-cost deposits decreased 5 percent. Total deposits increased 3 percent year-on-year to P519 billion.
Gross loans stood at P450 billion, down 5 percent from year-ago level. Gross retail loans decreased 12 percent year-on-year, and account for 25 percent of total loans, while wholesale loans decreased 2 percent.
“Our team’s focus on clients remains steadfast. We are hopeful that progress on vaccination in the coming quarters will help the country resume its growth trajectory,” said Security Bank President & CEO, Sanjiv Vohra.
He added that, “We are fortunate that our strong capital equips the Bank to support clients directly through loans and indirectly through significant investments in both our team and our technology to improve customer experience.”