Security Bank Total Revenues Grew 28% YOY to P40 Billion, Pre-Provision Operating Profit Up 34% in 9M24

Security Bank Corporation (SECB) posted net profit of P8.5 billion in the first nine months of 2024 (9M-2024), up 12% year-on-year. Revenue growth accelerated in 9M-2024 at 28% year-on-year compared to the 24% posted in H1-2024.

9M-2024 total revenues increased to P40.0 billion, driven by growth in both net interest income and non-interest income. Net interest income increased 31% to P32.4 billion. Net interest margin in 9M-2024 remained robust at 4.90%. Total non-interest income likewise increased 18% year-on-year to P7.6 billion. Service charges, fees and commissions grew 55% to P6.7 billion.

9M-2024 operating expense was 24% higher, driven by investments in manpower and technology to accelerate transformation. Cost-to-income ratio was 58.8% which is better than the 60.7% a year ago.

9M-2024 pre-provision operating profit was up 34% year-on-year to P16.5 billion. The Bank set aside P5.1 billion as provisions for credit losses in 9M-2024, an increase versus year-ago level of P2.6 billion. Gross non-performing loan ratio was 3.08% and NPL reserve cover was 79.5%.

Return on shareholders’ equity was 8.1%. Return on assets was 1.2%.
Quarterly Results: For the period July 1 to September 30, 2024 (Q3-2024), net profit was P3.0 billion, up 14% year-on-year and up 7% quarter-on-quarter. Q3-2024 total revenues increased to P14.4 billion, up 36% year-on-year and up 9% quarter-on-quarter.

Q3-2024 net interest income was P10.7 billion, up 19% year-on-year. Net interest margin in Q3-2024 was 4.66%. Total non-interest income in Q3-2024 was P3.6 billion, up 129% year-on-year and up 62% quarter-on-quarter. Q3-2024 non-interest income was driven by securities trading gains of P889 million, and service charges, fees and commissions of P1.8 billion which grew 20% year-on-year. In Q3-2024, the Bank set aside P1.8 billion as provisions for credit losses, same level as quarter ago. Q3-2024 pre-provision operating profit was P5.8 billion, 42% higher than year-ago level.

Balance sheet remains strong

Total deposits increased to P720 billion, up 28% year-on-year. CASA deposits increased 11% year-on-year. CASA as percent of total deposits was at 53%.

Net loans accelerated to 24% growth rate year-on-year from the 19% posted in Q2-2024. Quarter-on-quarter, net loans increased 8%, amounting to P623 billion as of September 30, 2024. Retail and MSME loans sustained its growth, up 38% year-on-year. Wholesale loans accelerated to 19% growth rate year-on-year from the 14% posted in Q2-2024. The growth in retail and MSME loans was driven by home loans which grew 21%, credit cards which rose 70%, auto loans which grew 51%, and MSME loans which

increased 58%. On a sequential quarter-on-quarter basis, retail and MSME loans increased 9%. Retail and MSME loans as percent of total loans increased to 32%, up from 29% a year ago. Total investment securities grew 30% year-on-year to P280 billion.

The Bank maintains healthy liquidity, with Liquidity Coverage Ratio (LCR) at 186% and Net Stable Funding Ratio (NSFR) at 135% as of September 30, 2024.

Security Bank’s capital ratios remain strong. Common Equity Tier 1 Ratio was 13.3% and Total Capital Adequacy Ratio (CAR) was 14.2%. Total assets increased to P1.0 trillion, up 26% year-on-year. Shareholders’ capital likewise increased to P143 billion, up 8% year-on-year.

On October 29, 2024, the Bank’s Board of Directors approved the second semestral regular cash dividend of P1.50 per common share with payment date on November 27, 2024. This will bring the total cash dividends for the year to P3.00 per common share. The Bank had earlier paid regular cash dividend for the first semester of P1.50 per common share on April 29, 2024.
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“We are pleased with our third quarter results. The combination of our client engagement, significant investments in our team and our technology has accelerated the bank’s growth. We are excited about delivering on our Better Banking promise.” said Security Bank President & CEO, Sanjiv Vohra.

Security Bank is a private domestic universal bank in the Philippines with total assets of P1 trillion as of September 30, 2024. The Bank has been operating for 73 years since it was established in 1951. Security Bank has a total of 334 branches and 678 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; 3 Golden Arrow Recognition for corporate governance excellence by the Institute of Corporate Directors (ICD).

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.