Maybank Philippines Inc. (MPI), the local unit of the Maybank Group, posted a 146 percent increase in its net income to P1.01 billion in 2014 from P409 billion a year earlier.
It said in a statement on Wednesday, the bank booked the record net income on the strength of its core business and despite the intense competition and challenging market conditions.
MPI said its financial performance marked a new milestone in 2014 as earnings rose to a new height, growing more than two-fold to breach the P1-billion mark, a first since the bank started operations in the Philippines in 1997.
The bank said the growth was boosted by market-beating growth in its core businesses and the realization of one-off gains from its strong and consistent performance in the past three years.
This translated to a return-on-average equity of 9.5 percent from 4.2 percent a year ago.
“2014 turned out to be an eventful year for MPI as new milestones and breakthroughs were achieved against a business environment that remained challenging not only for MPI, but the whole banking industry as well,” MPI President and Chief Executive Officer Herminio Famatigan Jr. said.
Famatigan said the bank beat the industry’s performance by posting faster growth rates, which was reflected by the expansion of its core businesses.
Aside from above-industry net interest margin, which improved to 5.01 percent by managing down the cost of funds, the strong growth in net interest income was also fuelled by the continued growth of MPI’s loans.
Loans rose 32 percent year-on-year to P49 billion from P38 billion. In particular, consumer loans climbed 44 percent and commercial loans by 24 percent.
“Both our retail and corporate lending businesses performed well last year. On top of this, our Treasury team also boosted our profit with the positions they took allowing us to realize significant interest income from investments and placements,” Famatigan said.
MPI said it was not spared from depressed trading gains last year, dragging its non-interest income.
The strong growth in net interest income, however, allowed MPI to post a healthy growth in operating income, which rose by 26 percent to P1 billion.
MPI said it was able to bring down total interest expense by 20 percent even with the 4 percent growth in total deposits.
The bank has also improved its cost management last year under the Maybank Group’s Strategic Cost Management Program as demonstrated by the Bank’s operating expenses, which amounted to P3.43 billion—about P101.83 million below its projected expenses for 2014.
By end 2014, MPI said it remained well-capitalized with a capital adequacy ratio of 16.7 percent, above the central bank’s 10 percent minimum requirement, while its Tier 1 capital stood at 15.6 percent.
MPI said it is poised for further growth in the Philippine market as it sees the sizeable infrastructure investments and aggressive expansion of branch network done in the previous years start to pay significant dividends.
“We remain committed to our long-term aspiration of being one of the top 10 most profitable banks in the Philippines and the top five players in key consumer and enterprise financing segments,” Famatigan said.