050407: Security Bank earnings jump 40% to P757M in first quarter

By Ted P. Torres
The Philippine Star 05/04/2007

Security Bank Corp. registered a 40 percent growth in net earnings in the first three months of 2007 to P757.6 million from P540 million in the same period last year, the bank said in a statement.

It said a major driver for the strong profit growth was the 23 percent increase in revenues over the same period last year to P2.2 billion.

This led to a 19 percent improvement in net interest income and 27 percent growth in non-interest income, including increase in net interest margins by 38 percent in earning assets to P129.3 billion.

The robust growth in earning assets helped defray the impact of a 273-basis point decline in average interest rates from the same period last year, the bank added.

The increase in earning assets was complemented by a 67.8 percent build-up in total deposits over the same quarter last year to P101.4 billion.

Savings deposits doubled to P73.4 billion, while time deposits likewise reflected a growth of 17.9 percent to P28 billion.

"We have placed a great deal of focus on the needs of our customers and diligently worked to provide them with a range of deposit and investment products tailored to their requirements," said Alberto Villarosa, Security Bank president and chief executive officer.

"The excellent growth in funding is an important component in our strategy to build a larger base of recurring revenues derived from lending activities. Coupled with our very healthy balance sheet and capital adequacy, we have both the funding and capital needed to sustain growth in the medium term," he added.

Security Bank chief financial officer Carlos Borromeo said that over the last three years, the bank built a respectable fixed income and investment product distribution business.

"Since these flows are customer driven, it is recurring in nature. In addition, having built a larger deposit base including the lower cost current accounts, we have created a stronger base of recurring deposit related fee-based income," Borromeo added.

Operating expenses were modestly higher at P927.4 million, up four percent over the first quarter of 2006.

Earnings per share grew to P2.30 over the P1.64 recorded for the comparable period last year. This equates to an annualized earnings per share of P9.20, higher by P3.43 or 59 percent than that recorded at year-end 2006.

 

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