Risal Commercial Banking Corp. (RCBC) net income rose 70 percent to P3.64 billion in the first quarter of the year from P2.14 billion in the comparable quarter of last year, driven by the unexpected gain from the sale of various real estate properties. The Yuchengco-led bank’s net interest income fell 9.7 percent to P7.28 billion from P8.05 billion, as the increase in interest expense outpaced the increase in interest earnings due to the combined effects of increased volume and increased interest. rates
The bank’s other operating income more than tripled to P5.73 billion from P1.85 billion, as miscellaneous profit reached P3.73 billion or nearly eight times last year’s P479 million, largely due to proceeds from the sale of various real estate properties.
Similarly, service fees and commissions increased 26.6 percent to P1.42 billion from P1.12 billion due to higher fee-based revenues led by credit cards, loans and deposits, and fees while foreign exchange gains reached P405 million from P24 million due to higher foreign exchange income from commercial operations.
RCBC’s operating expenses grew 22.3 percent to P7.19 billion from January to March this year compared to P5.88 billion in the same period last year due to higher employee benefits as well as to pay taxes and licences.
The provision for potential credit losses fell by 3.9 percent to P1.49 billion from P1.55 billion as asset quality showed marked improvement, returning to pre-pandemic levels at 1.99 percent of net non-performing loans (NPLs) at the end of March.
Its total resources expanded by 20 percent to P1.2 trillion with the steady build-up of client loans from profitable assets by 10 percent and investment securities by 27 percent.
With 18 percent asset growth for the period, the bank’s loan portfolio was focused on the highest-performing segments, such as small and medium-sized enterprises (SMEs), up 18 percent, loans from consumption 14 percent and accounts receivable from credit cards 46 percent. percent.
Credit card billing increased by 67 percent, supported by the platform and improved digital features. Additionally, data analysis enabled strong acquisition in the first quarter, with 44 percent more new card issuances and keeping card delinquency rates within industry levels.
The strong increase in deposits by 27 percent to P859 billion, driven by the 17 percent increase in CASA deposits, supported the asset build strategy.
“We are strengthening our sales network to enable broader and more efficient coverage, guided by science and data analysis to better understand customer needs and better serve customers,” said RCBC President and CEO Eugene Acevedo.
In addition, the capital of the RCBCs improved by seven percent, keeping the capital adequacy ratios above the minimum regulatory requirements. With the upcoming P27.1 billion capital injection from Japan’s Sumitomo Mitsui Banking Corp. (SMBC), the bank expects a 300-400 basis point improvement in Common Equity Tier 1 (CET1) ratios to further support plus its expansion of assets.
“There are many opportunities for synergy and collaboration with SMBC, some of which we have been actively pursuing in recent months. By embracing SMBC’s global best practices, we seek to redefine banking as a whole and raise the bar on the customer experience,” said RCBC.
At the end of March, RCBC had a total consolidated network of 462 branches, 1,371 ATMs and 1,784 ATM Go terminals strategically located nationwide.
Pan Malayan Management and Investment Corp., the holding company for the flagship institutions of the Yuchengco Group of Companies, has a 29.64 percent stake in RCBC, while Taiwan’s Cathay Life Insurance Corp. owns 22.19 percent.