Security Bank Corp., the sixth-largest lender in terms of assets, said Tuesday it received the approval of the Bangko Sentral ng Pilipinas to issue up to P20 billion worth of long-term negotiable certificates of time deposits in several tranches.
The bank’s board of directors approved the planned LTNCD issuance in a meeting conducted on March 26, 2019.
“Pursuant to the approval of the board of directors disclosed on March 26, 2019 and the authority granted by the Bangko Sentral ng Pilipinas as embodied in Monetary Board Resolution No. 828 dated May 30, 2019, Security Bank Corp. was authorized to issue up to P20 billion long-term negotiable certificates of time deposits in multiple tranches,” the bank said in a disclosure to the stock exchange Tuesday.
Like regular time deposits offered by banks, LTNCDs offer higher interest rates. These instruments cannot be pre-terminated but can be sold on the secondary market, making them “negotiable.”
Security Bank raised P5.8 billion in May last year, marking the second tranche of its P20-billion bond program and following the P8.6 billion LTNCDs raised in November 2017.
Security Bank reported a net income of P2.38 billion in the first quarter, up by 1.5 percent from a year ago, fueled by sustained strength in loans and deposits.
The January-to-March net profit was also 15 percent higher than the level posted in the fourth quarter of 2014.
Total revenues grew 20 percent year-on-year to P7.6 billion. A core revenue component, net interest income from customer loans and deposits sustained its healthy trajectory, growing by 29 percent to P4.7 billion.
This was driven by the continued expansion of retail loans and low-cost deposits. Retail loans grew 49 percent while low-cost deposits increased 11 percent. Retail loans accounted for 23 percent of total loans, up from 17 percent a year ago.
Total loans increased 12 percent year-on-year to P412 billion while total deposits grew 10 percent to P461 billion.