Metropolitan Bank & Trust Co. (Metrobank) has reported a record-breaking net income of PHP 23.6 billion in the first half of 2024, showcasing its strong financial performance amidst a challenging economic landscape.
This impressive result reflects a 13.3% return on equity, a notable increase from the 12.9% recorded during the same period last year, underscoring the bank’s robust asset expansion, stable margins, and effective cost management. This increase, as highlighted by data from the Philippine Stock Exchange (PSE), underscores Metrobank’s resilience and steady growth in the face of economic challenges.
In a press release, Metrobank President Fabian S. Dee attributed the bank’s stellar performance to its solid capital position and robust asset profile, which have been instrumental in driving the expansion of its core businesses despite ongoing market challenges. “Our strong capital position and robust asset profile continued to support our expanding core businesses despite market challenges. Prospects of easing inflation driven by government efforts could further spur consumer demand,” Dee remarked.
He further emphasized that the bank is on track to meet its medium-term growth aspirations as it continues to support various public and private sector initiatives that are key drivers of economic growth.
Significant growth in Metrobank’s lending portfolio
One of the standout aspects of Metrobank’s performance in the first semester was the significant growth in its lending portfolio. Gross loans surged by 14.9% year-on-year, propelled by a 15.2% increase in commercial loans and a 13.7% rise in consumer loans.
The consumer segment saw particular strength, with net credit card receivables soaring by 21.4% and auto loans growing by 16.6%. This momentum in the lending business was a critical factor in boosting the bank’s net interest income, which rose by 14.6% to PHP 58.0 billion.
The bank’s net interest margin also edged up to 4.0% from 3.9% last year, reflecting its ability to maintain healthy spreads in a competitive market.
Metrobank’s deposit base also expanded significantly, with total deposits growing by 7.8% year-on-year to PHP 2.4 trillion as of the end of June 2024. Notably, low-cost Current and Savings Accounts (CASA) accounted for 58.0% of the total deposit base, highlighting the bank’s strong funding position.
Metrobank’s deposit base also expanded significantly
In terms of non-interest income, Metrobank reported stable fee income in the first half of the year, with second-quarter growth accelerating to 8.4%. This was largely driven by continued expansion in the bank’s consumer business, which has been a key focus area for growth.
Operating expenses were effectively managed, with cost growth contained at 8.1% year-on-year, totaling PHP 36.4 billion. This disciplined approach to cost management enabled Metrobank to maintain a cost-to-income ratio of 52.3% as of the end of June, demonstrating its operational efficiency while continuing to invest in enhancing client services.
Metrobank’s asset quality also improved, with its non-performing loans (NPLs) ratio declining to 1.66% from 1.84% last year, significantly below the industry average of 3.7% as of May 2024. This improvement allowed the bank to reduce its loan loss provisions to PHP 1.0 billion in the first semester while maintaining a high NPL cover of 162.7%, providing a substantial buffer against potential risks.
The bank’s total consolidated assets expanded by 14.5% year-on-year, reaching PHP 3.3 trillion, reaffirming its position as the second-largest private universal bank in the Philippines.
Metrobank’s capital ratios remain among the highest in the industry, with a capital adequacy ratio of 16.7% and a Common Equity Tier 1 (CET1) ratio of 15.9%, both well above the Bangko Sentral ng Pilipinas (BSP) regulatory requirements. Additionally, the bank’s Liquidity Coverage Ratio (LCR) stood at a substantial 259.9%, reflecting its strong liquidity position.
Best Bank for Corporate Responsibility
In recognition of its commitment to corporate responsibility, Metrobank was awarded the Best Bank for Corporate Responsibility at the Euromoney Awards for Excellence 2024 last July. This accolade acknowledges the bank’s efforts through the Metrobank Foundation Inc., which supports initiatives in health, education, the arts, and social development across the Philippines.
The bank was also named “Best Bank for Ultra-High-Net-Worth” at the Euromoney Global Private Banking Awards held in March this year.
“We take this recognition as both an affirmation of our efforts and a challenge to continue elevating the services we provide. Trust is paramount to us, and being recognized as the preferred bank for affluent families in the Philippines underscores Metrobank’s dedication to keeping our valued clients in good hands,” said Lizette Perez, Head of Metrobank’s Private Wealth Division.
Euromoney also acknowledged Metrobank’s leadership in the UHNW segment in 2023, noting the impressive quality of services provided by the bank and its highly capable team.
“The bank has one of the industry’s most knowledgeable and experienced group of relationship managers. In addition, UHNW clients have access to the entire product suite that the Group offers across its Treasury Group and Trust, Branch, and Consumer Banking Business,” said Euromoney.
As Metrobank continues to execute its growth strategy and strengthen its market position, it remains well-equipped to navigate the challenges ahead, driven by its solid financial foundation and strategic focus on key growth areas.to build on its successes, it remains a key player in the country’s financial sector.