Metrobank net income up 60%

METROPOLITAN Bank & Trust Co. (Metrobank) saw its net profit rise 60% last year as it set aside lower loan loss reserves.

The bank’s net profit reached 22.364 billion pesos in 2021 from 13.974 billion pesos in 2020, based on its audited financial statements filed with the local stock exchange.

Return on equity increased to 6.89% at the end of 2021, from 4.36% a year earlier. Meanwhile, the return on average assets fell from 0.56% to 0.89%.

However, the lender’s net profits have yet to return to the pre-pandemic level of P28.874 billion in 2019.

“Our positive performance in 2021 validates our strategies of strengthening our balance sheet and proactively provisioning during the pandemic,” Metrobank Chairman Fabian S. Dee said in a statement.

Metrobank’s net interest income fell 12.8% to 75.049 billion pesos in 2021 from 86.107 billion pesos a year earlier, mainly due to lower income from loans and receivables amid a decline in the volume and cap on credit card interest rates.

Interest received on loans and receivables fell 23.5 percent year-on-year to 65.525 billion pesos from 85.69 billion pesos. The bank’s net interest margin has stabilized at 3.4% since the second quarter of 2021.

“The sequential quarterly recovery in business and credit card lending was also sustained, reflecting improving business and consumer confidence,” Metrobank said.

It added that the 12% increase in its low-cost current and savings accounts to 1.5 trillion pesos had helped lower overall funding costs.

Metrobank’s loan loss provisions reached 11.834 billion pesos, down 71% from 40.76 billion pesos in 2020, at the height of the pandemic shutdowns.

Gross non-performing loans (NPLs) fell 11.5% to 27.354 billion pesos from 30.919 billion pesos.

This brought the bank’s NPL ratio to 2.2% from 2.4% the previous year. NPL coverage also improved from 163% to 174.7%.

Meanwhile, the lender’s non-interest income fell 26.4% year-on-year to 25.831 billion pesos from 35.129 billion pesos, amid falling trade and foreign exchange gains that compensated for the increase in free income.

Broken down, income from fees, services and commissions increased by 14.6% to reach 13.418 billion pesos. However, trading gains fell 48.9% to 3.354 billion pesos, while foreign exchange gains fell 55.9% to 1.904 billion pesos.

Other operating costs decreased by 1% from P60.12 billion to P59.473 billion, mainly due to lower occupancy costs and taxes.

At the end of 2021, Metrobank’s consolidated assets and equity stood at 2.5 trillion pesos and 318.5 billion pesos respectively.

Its capital adequacy ratio was estimated to have ended 2021 at 19.3%, while the Common Equity Tier 1 capital ratio was estimated at 18.4%, based on its balance sheet at the end of December. Both are above minimum regulatory requirements.

The Ty-led lender raised 19 billion pesos through its 5.25-year bond offering in May last year.

Metrobank shares ended at P59.50 apiece on Thursday, down 35 centavos or 0.58% from its previous close. — Noble LWT

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