050907: Security Bank reports 40% hike in Q1 income to P757 M

By FIL C. SIONIL Security Bank Corporation yielded a 40 percent increase in its net income for the first quarter of the year to P757.6 million from P540.3 million a year ago, lifting its return on equity by 20 percent to 24.5 percent. In its disclosure to the Philippine Stock Exchange (PSE), Security Bank President and Chief Executive Officer Alberto S. Villarosa attributed the healthy performance of the bank to, in part, the 23 percent uptick in revenues, ekeing in some P2.2 billion. Buoyed by its healthy income growth, Villarosa informed the PSE of the bank's board of directors' decision to share the profits to its shareholders through a combined P1 regular and special cash dividend per share to be paid out within the first semester of the year. Using the P65.50 share price ending 2006, the combined move will translate to an annualized dividend yield of around three percent. Dissecting further its revenue performance, Security Bank posted a 19 percent expansion in its net interest income and another 27 percent hike in non-interest earnings amidst a decelerating interest rates. Like most banks and other financial institutions, Security Bank's net interest margins shrunk with the 273 basis points dip in average interest rates ending first quarter of the year vis-à-vis 2006. In spite this development, Security Bank's treasury operations remained relatively spirited as indicated by the 19 percent hike in net interest margins. Security Bank admitted the lower interest rate environment proved challenging to the net interest margin component of revenues. Still, the bank's trading gains netted a 23 percent hike to P780.2 million. "We dealt with the significant decline in interest rates quite admirably. Our net margins remained intact, managed through a combination of a very healthy expansion of earning assets funded by a corresponding growth in lower cost deposits," claimed Security Bank Chief Financial Officer Carlos iM. Borromeo.

 

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