Security Bank Corporation H1-2024 Total Revenues Grew 24% YOY to P25.7 Billion, Net Profit Up 11% to P5.4 Billion

Security Bank Corporation (SECB) posted net profit of P5.4 billion in H1-2024, up 11% year-on-year, driven by accelerated growth in business drivers

H1-2024 total revenues grew 24% year-on-year to P25.7 billion. Net interest income increased 38% to P21.7 billion. Net interest margin in H1-2024 was 5.20%, up 96 basis points year-on-year. Service charges, fees and commissions grew 74% to P4.9 billion.

H1-2024 operating expense was 20% higher, driven by investments in manpower and technology to accelerate transformation. Strong performance led to a cost-to-income ratio of 58.4%, lower than the 60.4% a year ago.

H1-2024 pre-provision operating profit was up 30% year-on-year to P10.7 billion. The Bank set aside P3.3 billion as provisions for credit losses in H1-2024, an increase versus year-ago level of P1.6 billion. Gross non-performing loan ratio was 3.31% and NPL reserve cover was 81%.
Return on shareholders’ equity was 7.94%. Return on assets was 1.20%.

Quarterly Results: For the period April 1 to June 30, 2024 (Q2-2024), net profit was P2.8 billion, up 10% year-on-year and up 7% quarter-on-quarter. Q2-2024 total revenues increased to P13.2 billion, up 22% year-on-year and up 6% quarter-on-quarter.

Q2-2024 net interest income increased to P10.9 billion, up 32% year-on-year and up 2% quarter-on[1]quarter. Net interest margin in Q2-2024 was 5.18%, up 59 basis points year-on-year. Total non-interest income was P2.2 billion, up 28% quarter-on-quarter. Service charges, fees and commissions was P1.8 billion, up 19% year-on-year. In Q2-2024, the Bank set aside P1.8 billion as provisions for credit losses.

Q2-2024 pre-provision operating profit was P5.8 billion, 18% higher than quarter-ago level due to higher revenue growth of 6% quarter-on-quarter compared to operating expense which decreased by 2% quarter-on-quarter.

Total deposits increased to P676 billion, up 29% year-on-year. CASA deposits increased 9% year-on-year. CASA as percent of total deposits was at 54%.

Net loans accelerated to 19% growth rate year-on-year from the 12% posted in Q1-2024. Quarter-on-Quarter, net loans increased 6%, amounting to P577 billion as of June 30, 2024. Retail and MSME loans sustained its growth, up 37% year-on-year compared to the 32% posted in Q1-2024. Wholesale loans accelerated to 14% growth rate year-on-year from the 4% posted in Q1-2024. The growth in retail and MSME loans was driven by home loans which grew 21%, credit cards which rose 60%, auto loans which grew 50%, and MSME loans which increased 68%. On a sequential quarter-on-quarter basis, retail and MSME loans increased 8%. Retail and MSME loans as percent of total loans increased to 32%, up from 31% a quarter ago and 28% a year ago. Total investment securities grew 22% year-on-year to P268 billion.

The Bank maintains healthy liquidity, with Liquidity Coverage Ratio (LCR) at 180% and Net Stable Funding Ratio (NSFR) at 133% as of June 30, 2024.

Security Bank’s capital ratios remain strong. Common Equity Tier 1 Ratio was 13.9% and Total Capital Adequacy Ratio (CAR) was 14.8%. Total assets increased to P948 billion, up 19% year-on-year. Shareholders’ capital likewise increased to P138 billion, up 6% year-on-year.

“Our second quarter results reflect accelerating velocity for our Retail, MSME & Wholesale client teams. We allocated substantial resources to support our clients’ aspirations as indicated in the growth of loans and deposits. Likewise, we continue to invest in technology to improve customer experience, security & agility. This led to healthy growth in net income year-on-year and quarter-on-quarter. Operating jaws turned positive 4%.” Security Bank President & CEO, Sanjiv Vohra.

Security Bank is a private domestic universal bank in the Philippines with total assets of P948 billion as of June 30, 2024. The Bank has been operating for 73 years since it was established in 1951. Security Bank has a total of 328 branches and 662 ATMs, Cash Recycler Machines (CRMs) and Cash Acceptance Machines (CAMs) to-date.

In 2024, Security Bank was awarded Best for High-Net-Worth in the Philippines by Euromoney/Asiamoney for four consecutive years; The Philippines' Best Bank for Corporates by Euromoney/Asiamoney for two consecutive years; Best Branch Digitisation Implementation for the Mosaic Voyager (MV) Tellering and Lobby Management System by The Asian Banker; three awards Credit Card Initiative of the Year, Sustainability Initiative of the Year, and ESG Program of the Year (Bronze) for Security Bank Wave Mastercard by Asian Banking and Finance; and Best Investor Relations Company (Philippines), Sustainable Asia Award, Asia’s Best CEO (Investor Relations), Asia’s Best CFO (Investor Relations) and Best Investor Relations Professional (Philippines) by Corporate Governance Asia for four consecutive years.

In 2023, Security Bank was awarded Best for Mass Affluence/HNW in the Philippines by Asiamoney; Best Credit Card Product in the Philippines (for Security Bank’s Complete Cashback Platinum Mastercard) by The Asian Banker during the 2022 Asian Banker Excellence Awards; Best Retail Bank in the Philippines by Alpha Southeast Asia; Market Leader in Corporate Social Responsibility (CSR) by Euromoney; Market Leader in Diversity & Inclusion by Euromoney; Best Bank for Diversity and Inclusion by Asiamoney. The Bank’s major citations in 2021 are: Philippines’ Best Bank by Euromoney; Best for HNWs (High Net Worth Clients) in the Philippines by Asiamoney; Best Retail Bank in the Philippines by Alpha Southeast Asia; and Best Culture of Learning and Diversity Champion by LinkedIn Talent Awards.