Stock News 2012: Banks’ NPL Ratio Improves Further To 2.05% In Third Quarter

English: Central Bank of the Philippines (Main) (Photo credit: Wikipedia)

The Bangko Sentral ng Pilipinas (BSP) yesterday reported that the 37 major banks’ non-performing loans (NPL) ratio improved to 2.05 percent as of the end of the third quarter as soured loans continue to decline.

BSP’s latest data showed that NPL ratio as of end-September was 0.03 percentage point lower compared to end-August and by 0.41 percentage point lower than last year’s 2.46 percent. Net of interbank loans, the NPL ratio was lower by 0.03 percentage point to 2.15 percent.

Borrowers or debtors with unpaid loans for 30 days are considered NPL accounts while unpaid loans of more than 90 days will generally be considered in default.

The central bank in October revised the rules on banks’ NPL by including the net amount of NPLs as a “complementary measure” to gross NPLs. Net NPLs are gross NPLs less specific allowance for credit losses on the total loan portfolio.

In the first nine months of the year, the 37 universal/commercial banks have reported R69.94 billion-worth of borrowers’ past due loans. This is lower than August’s R70.43 billion and the same period in 2011 of R74.33 billion.

The big banks’ total loan portfolio, in the meantime, increased to R3.41 trillion from R3.378 trillion in the previous month and R3 trillion last year.

The BSP said NPL ratio improved because of the 0.69 percent reduction in total bad loans and the 0.96 percent expansion in total loan portfolio.

“The industry’s provisioning against potential credit losses remained adequate,” stated the BSP.

The NPL coverage ratio or loan loss reserves to NPLs strengthened to 136 percent from 135.81 percent in August and from last year’s 123.70 percent ratio.

The coverage ratio for non-performing assets (NPA) narrowed to 69.39 percent from 69.44 percent in August but it was higher compared to last year’s 62.68 percent ratio. As of end-September, the big banks’ NPAs declined to R176.34 billion from R177.12 billion in the previous month and R191.06 billion the same period in 2011.

NPAs are computed including NPL and real and other properties and acquired or ROPA

The banks’ restructured loans, on the other hand, totaled R35.5 billion, hardly changed on a monthly basis but considerably lower compared to last year’s R40.98 billion.

http://www.mb.com.ph/articles/383808/banks-npl-ratio-improves-further-to-205-in-third-quarter#.T8GjbOSmj3w

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Stock News 2012: Metrobank earnings rise 32% to P11 B

One of the country’s top lenders Metropolitan Bank & Trust Co. (Metrobank) registered its fourth straight year of strong income growth as it reported a 32 percent increase in net earnings in 2011 to P11 billion.

In a statement, Metrobank said total deposits grew 4.6 percent year-on-year to P681 billion while net loans and receivables rose 16.5 percent to P457.4 billion, with strong growth coming from both the consumer and commercial segments.

Thus, operating income growth was supported by the 11.4-percent increase in net interest income to P29.4 billion which, in turn, was driven by the 7.3-percent growth in low cost deposits and the 16.5 percent hike in net loans and receivables.

Metrobank likewise recorded a return on average equity of 11.2 percent in 2011, from 10.3 percent the previous year.

Meanwhile, its healthy growth in assets and improved deposit mix pushed net interest margin 11 basis points higher to 3.5 percent.

In addition, service charges, fees and commissions registered a healthy 12.5 percent increase to P7.7 billion, while income from trading and foreign exchange grew to P7.7 billion.

Operating expenses grew 10.3 percent year-on-year to P30.7 billion, driven by higher manpower and occupancy-related costs.

Provisions for credit and impairment losses declined 47.5 percent to P3.8 billion, as gross non-performing loans (NPLs) were reduced by 8.3 percent, settling at P10.1 billion by the end of 2011.

Thus, the NPL ratio further declined to 2.2 percent at yearend, from 2.9 percent in 2010, while the NPL coverage was comfortably higher at 99.5 percent, from 92.3 percent in 2010.

Consolidated assets ballooned further to P958.4 billion, or eight percent more than the P887.3 billion in 2010.

Total equity reached P109.8 billion, up 25.3 percent from the previous year’s P87.6 billion.

At the end of 2011, Metrobank’s capital adequacy ratio (CAR) further improved to 17.4 percent from 16.4 percent in 2010, well above the 10 percent regulatory minimum. Tier 1 capital ratio likewise rose to 13.7 percent, from 12 percent in the previous year.

http://www.philstar.com/ArticleListBySubCategory.aspx?publicationSubCategoryId=66

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Stock News 2012: RCBC nets P5 billion in 2011

Rcbc plaza (Photo credit: Wikipedia)
Rizal Commercial Banking Corp. (RCBC) registered an 18-percent increase in net earnings in 2011 to P5.01 billion from P4.25 billion in 2010.

In a statement, the bank said huge gains were realized from trading, service fees, commissions and trust fees which grew to P7.11 billion, representing 74 percent of non-interest income.

Meanwhile, net interest income stood at P10.75 billion, slightly lower than the P10.8 billion in 2010.

RCBC officials said the bank continued to build on its financial strength following a deliberate strategy of prudent balance sheet management.

Total consolidated resources reached P345.77 billion, or 8.06 percent higher than the prior year.

Loans grew to P184.67 billion with corporate accounts rising 30 percent, SME loans by 37 percent, and consumer loans by 15 percent. Net interest margin was high at 4.09 percent.

Its non-performing loan (NPL) ratio dropped to 1.47 percent from the previous year’s 3.10 percent. Likewise, NPL provisioning coverage improved to 103.4 percent.

Capital funds grew 25.10 percent to P40.55 billion from P32.41 billion a year ago on the back of higher earnings and the P5.8-billion Tier 1 equity investments by the World Bank’s International Finance Corp. (IFC) and CVC Capital Partners, one of the top five largest private equity firms in the world.

The consolidated capital adequacy ratio (CAR), an international measure of estimating the general health of a bank, stood at 19.31 percent as of end-2011, with much leeway for asset growth from the minimum regulatory requirement of 10 percent. The CAR Tier 1 ratio of 14.58 percent also exceeded the BSP’s six percent requirement.

Total deposits ballooned to P255.46 billion as the bank continued to focus on growing its low cost deposits, which grew 20.33 percent, while prudently reducing higher costing time deposits.

Operating expenses reached P12.15 billion as the bank continued to expand its branch and ATM network in order to increase reach and improve customer convenience.

http://www.philstar.com/ArticleListBySubCategory.aspx?publicationSubCategoryId=66

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