Security Bank profit slips to P2.7 biliion in Q1

SECURITY Bank Corp. recorded a 4% decline in its first-quarter net profit as it booked trading and foreign exchange (FX) losses due to market volatility and also set aside more provisions amid the Middle East conflict.

The bank’s attributable net income went down to P2.704 billion in the period from P2.82 billion a year ago, it said in a disclosure to the stock exchange on Thursday.

This translated to a return on average assets of 0.9% and a return of average equity of 7.03%, down from the previous year’s 1.01% and 7.92%, respectively.

“We had a solid start to the year, driven by stronger core earnings and disciplined cost management. We remain focused on sustaining operational discipline, growing responsibly, and making banking simpler, faster, and more responsive for our customers,” Security Bank President and Chief Executive Officer Victor Lee Meng Teck said.

Net interest income climbed by 27.61% to P15.16 billion from P11.88 billion a year ago, mainly driven by higher interest earnings on loans as its credit cards, time loan, auto loan and home loan portfolios grew.

Net interest margin rose to 5.36% from 4.51% a year ago.

Meanwhile, other income declined to P1.9 billion in the quarter from P3.5 billion last year.

This was mainly due to the P712.48-million net trading and securities loss and the P977.55-million net FX loss it booked in the period amid unfavorable market movements during the period influenced by geopolitical developments.

Service charges, fees, and commissions also dropped to P2.06 billion in the quarter from P2.16 billion in the same period last year.

Still, total operating income grew by 10.48% year on year to P17.03 billion.

Meanwhile, Security Bank’s operating expenses went up by 14.36% to P13.4 billion in the first three months from P11.72 billion in the same period last year, driven mainly by a 63.2% increase in loan loss provisions to P3.88 billion from P2.38 billion, which it said is part of its “prudent risk management approach amid evolving operating conditions.”

It said its pre-provision operating profit rose 24% year on year to P7.5 billion.

The bank’s cost-to-income ratio improved to 55.89% from 60.59% a year ago.

Net loans stood at P679.44 billion at end-March, up 5% year on year, supported by efforts to rebalance its portfolio towards higher-quality segments, it said.

“Asset quality metrics remain manageable, with gross nonperforming loan (NPL) ratio at 3.08% and NPL reserve cover at 81%.”

On the funding side, total deposits were at P937.98 billion, rising by 12% year on year. Current account, savings account deposits grew by 13%, comprising 51% of the total.

Its net loans-to-deposit ratio was at 72.44%.

Security Bank’s assets stood at P1.22 trillion as of March, up from P1.19 trillion at end-2025 and also rising by 10% year on year.

Meanwhile, total equity edged down to P153.48 billion from P154.23 billion at end-2025, but was up 7% from the prior year.

Security Bank’s common equity Tier 1 ratio was at 12.2%, while total capital adequacy ratio stood at 13.09%.

“The bank maintains healthy liquidity, with liquidity coverage ratio at 198% and net stable funding ratio at 145% as of March 31.”

Security Bank shares rose by 65 centavos or 1% to close at P65.75 each on Thursday. — A.M.C. Sy