Security Bank Corp. (philippines) · PSE:SECB
Security Bank Corp. (philippines) — Security Bank — H1 2019 Earnings Presentation
26 slides from Security Bank Corp. (philippines)'s earnings presentation, Aug 7, 2019
Slide 1: H1-2019 Results Highlights
H1-2019 Results Highlights By: Mr. Sanjiv Vohra, President & CEO August 7, 2019
Slide 2: Q2-2019 Net Income Up 32% YoY to PhP 2.57 Billion
Q2-2019 Net Income Up 32% YoY to PhP 2.57 Billion Up 8% vs. quarter-ago level. Net Income ₱2.57 Billion 2.57 +8% +32% 2.38 1.95 +₱0.62 B +₱0.19 B Q2-2018 Q2-2019 Q1-2019 2
Slide 3: Q2-2019 Total Revenues Grew 32% YoY
Q2-2019 Total Revenues Grew 32% YoY Total Revenues ₱7.9 Billion +32% 7.9 +₱1.9 B 6.0 Q2-2018 Q2-2019 3
Slide 4: Q2-2019 Net Interest Income from Customer Loans and Deposits Grew 44%
Q2-2019 Net Interest Income from Customer Loans and Deposits Sustained Strong Trajectory Growing by 44% Interest Income from Financial Investments grew by 7%. Net Interest Income from Interest Income from Financial Customer Loans & Deposits Investments ₱5.4 Billion 5.4 ₱2.6 Billion +44% 3.7 +₱1.7 B
Slide 5: Q2-2019 Total Net Interest Income Grew 22%
Q2-2019 Total Net Interest Income Grew 22% Net Interest Income ₱6.1 Billion +22% 6.1 +₱1.1 B 5.0 Q2-2018 Q2-2019 5
Slide 6: Total Loans Increased 11%
Total Loans Increased 11% Retail Loan growth accelerated to 54% YoY; Wholesale Loans grew 2%. Total Loans ₱427 Billion +11% +₱43 B 427 383 +54% 105 68 +2% 315 322 Jun. 30, 2018 Jun. 30, 2019 Note: Numbers may not sum due to rounding 6
Slide 7: Retail Loans Now Account for 25% of Total Loans vs. 18%
Retail Loans Now Account for 25% of Total Loans vs. 18% A Year-Ago as of Jun. 30, 2018 as of Jun. 30, 2019 18% 25% 82% 75% 7
Slide 8: Low-Cost Deposits Increased 11% YoY
Low-Cost Deposits Increased 11% YoY Total deposits grew 1%. Total Deposits ₱449 Billion 443 +1% 449 175 +11% 194 268 -5% 255 Jun. 30, 2018 Jun. 30, 2019 Note: Numbers may not sum due to rounding 8
Slide 9: Total Deposits and Peso Corporate Bonds Combined Grew 5% YoY
Total Deposits and Peso Corporate Bonds Combined Grew 5% YoY On June 28, 2019, the Bank issued Php 18 billion of fixed-rate peso corporate bonds with a tenor of 2 years as a cost-efficient alternative funding source to short-term high-cost deposits. Total Deposits and Peso Corporate Bonds ₱467 Billi
Slide 10: Net Interest Spread on Loans & Deposits Increased to 5.36% in Q2-2019
Net Interest Spread on Loans & Deposits Further Increased to 5.36% in Q2-2019 Quarter-on-Quarter Year-on-Year Net Interest Spread on Loans & Deposits up +38 bps up +108 bps at 5.36% in Q2-2019 10
Slide 11: Overall, Net Interest Margin Increased to 3.59% in Q2-2019
Overall, Net Interest Margin Increased to 3.59% in Q2-2019 Quarter-on-Quarter Year-on-Year Overall Net Interest Margin at 3.59% up +18 bps up +42 bps in Q2-2019 11
Slide 12: Q2-2019 Service Charges, Fees and Commissions Increased 70% to PhP 1.0 Billion
Q2-2019 Service Charges, Fees and Commissions Increased 70% to PhP 1.0 Billion Growth driven by Credit Cards, Loan Fees, Deposit Charges and Bancassurance. Service Charges, Fees & Commissions ₱1.0 Billion +70% 1,003 M +81% +₱412 M 235 Credit Cards +97% 591 M Loan Fees 215 +42% Deposit Charges 129 19
Slide 13: Q2-2019 Securities Trading Gains Amounted to PhP 376 Million
Q2-2019 Securities Trading Gains Amounted to PhP 376 Million Securities Trading Gains ₱376 Million 376 +₱329 M 47 Q2-2018 Q2-2019 13
Slide 14: Q2-2019 Non-Interest Income Increased by 81% to PhP 1.7 Billion
Q2-2019 Non-Interest Income Increased by 81% to PhP 1.7 Billion Non-Interest Income ₱1.7 Billion +81% 1.7 +₱0.8 B 1.0 Q2-2018 Q2-2019 14
Slide 15: H1-2019 Net Income Up 15% YoY to PhP 4.95 Billion
H1-2019 Net Income Up 15% YoY to PhP 4.95 Billion Net Income ₱4.95 Billion +15% 4.95 4.29 +₱0.66 B H1-2018 H1-2019 15
Slide 16: H1-2019 Net Interest Income from Customer Loans and Deposits Increased by 37%
H1-2019 Net Interest Income from Customer Loans and Deposits Increased by 37% Interest Income from Financial Investments grew by 9%. Net Interest Income from Interest Income from Financial Customer Loans & Deposits Investments ₱10.1 Billion 10.1 ₱5.2 Billion +37% +₱2.7 B 7.4 +9% 5.2 4.8 +₱0.4 B H1-2
Slide 17: H1-2019 Total Net Interest Income Grew 18%
H1-2019 Total Net Interest Income Grew 18% Net Interest Income ₱11.8 Billion +18% 11.8 +₱1.8 B 10.0 H1-2018 H1-2019 17
Slide 18: H1-2019 Non-Interest Income Increased by 57% to PhP 3.5 Billion
H1-2019 Non-Interest Income Increased by 57% to PhP 3.5 Billion Service Charges, Fees & Commissions • Service Charges, Fees & Commission up by 46%. • Securities Trading Gains totaled PhP 1.0 B. +46% 1.9 Non-Interest Income +₱0.6 B 1.3 ₱3.5 Billion +57% 3.5 +₱1.3 B 2.3 H1-2018 H1-2019 Securities Trad
Slide 19: Cost-to-Income at 53.7%
Cost-to-Income at 53.7% Operating Expense (excluding provisions for credit and impairment losses) grew by 23%. Excluding GRT and DST, Operating Expense grew 14% and Cost-to-Income ratio was 44.4%. Cost-to-Income Ratio Operating Expenses* 53.7% ₱8.3 Billion 54.6% +23% 53.9% 53.7% 8.3 YoY growth 6.7 +
Slide 20: Asset Quality Remained Healthy
Asset Quality Remained Healthy • Gross NPL Ratio at 1.10%, lower than industry’s 1.7% in May 2019. • H1-2019 Provision for Credit Losses was PhP 639 M. • NPL Reserve Cover of 127%, higher than industry’s 110% in May 2019. • Including Reserves in Retained Earnings (Restricted), NPL Reserve Cover of 1
Slide 21: Security Bank Among the Country's Best Capitalized Private Domestic Universal Banks
Security Bank Continues to be Among the Country’s Best Capitalized Private Domestic Universal Banks Common Equity Tier (CET) 1 Ratio increased to 16.8% from 16.5% a quarter-ago. Total Capital Adequacy Ratio likewise strengthened to 19.2% from 19.0%. CET 1 and Total CAR 16.8% and 19.2% 19.0% 19.2% 16
Slide 22: Return on Shareholders' Equity Increased to 8.8% from 8.1% in 2018
Return on Shareholders’ Equity Increased to 8.8% from 8.1% in 2018 Return on Shareholders’ Equity 8.8% 8.8% 8.1% 8.1% H1-2018 FY-2018 H1-2019 22
Slide 23: Total Assets Increased 8% YoY to PhP 777 B
Total Assets Increased 8% YoY to PhP 777 B Shareholders’ Capital Increased 7% YoY to PhP 115 B Total Assets (PhP B) Shareholders’ Capital (PhP B) +8% 777 722 +7% 115 107 Jun. 30, 2018 Jun. 30, 2019 Jun. 30, 2018 Jun. 30, 2019 23
Slide 24: Our Key Objectives
Our Key Objectives I. Improve Return on Shareholders’ Equity II. Improve Net Interest Margin III. Accelerate Growth of the Retail Banking Business IV. Profitably Grow Wholesale Business 24
Slide 25: Execution Excellence to Deliver BetterBanking Promise
Execution Excellence to Deliver BetterBanking Promise; Our Focus will be on: I. Differentiation at: • Product Level • Distribution Level • Customer Service Level II. Operational Efficiency: • I.T. • Finance Transformation • Human Capital Transformation 25
Slide 26: H1-2019 Results Highlights
H1-2019 Results Highlights By: Mr. Sanjiv Vohra, President & CEO August 7, 2019