Metrobank Net Income Up 27.1% To P7.8 Billion In 1Q2021
The robust net income growth was due to stable asset quality, strong non-interest income performance, and marginal rise in operating expenses.
Metropolitan Bank & Trust Company’s (Metrobank) net income leaped 27.1% YoY to P7.8 billion in the first quarter of 2021. The robust net income growth was due to stable asset quality, strong non-interest income performance, and marginal rise in operating expenses.
“Our strategy and prudent approach last year paved the way for a strong start in 2021,” said Metrobank President Fabian S. Dee. “Our capital position is double the regulatory minimum, with capital adequacy ratio (CAR) of 19.9% and Common Equity Tier 1 (CET1) of 19.0%. Our reserves also cover 166% of our non-performing loans (NPL). This ensures that Metrobank will sustain its business resilience, and we remain confident that the Bank is ready to take on opportunities as the economy recovers. We are in a strong position to withstand a resurgence in asset quality risks and we remain vigilant even as we all continue to battle the pandemic.” Mr. Dee added.
Non-interest income surged by 28% YoY to P7.9 billion. Fee-based revenue is stable at P3.3 billion despite business activities still being slower than pre-pandemic levels. Trust fee income grew at a robust 20%, in line with the 30% growth in assets under management. To top it off, trading and FX gains doubled to P2.9 billion as the Treasury group realized gains prior to the reversal of yields.
Clients continue to place their trust in the Bank as current account and savings account (CASA) deposits grew by 16% to P1.3 trillion. This enabled the Bank to reduce high-cost time deposits, which partly mitigated the drop in asset yields arising from the rate cuts in the past year. With the pandemic still on-going, loan demand remained slow, and naturally, net interest income trended lower. The Bank’s balance sheet has remained very liquid and ready to support clients when business volumes start improving.
NPL ratio stayed at 2.4% from end-2020. Restructured loans comprised 0.4% of total loans. The Bank set aside provisions of P2.5 billion in the first quarter, which is 50% lower YoY. NPL cover improved to 166% from 163% in December 2020.
Operating expenses were stable, inching up by just 1.4% to P14.7 billion from sustained efforts to enhance productivity and operational efficiency. Cost-to-income ratio was recorded at 54.6%.
Metrobank is the country’s second largest bank with consolidated assets of P2.4 trillion and equity of P306.6 billion.