METROPOLITAN Bank & Trust Co. (Metrobank) saw its net profit rise by 31.25% in the first quarter as its loan book expanded and as it posted higher margins and “healthy” fee income amid better asset quality.

The lender’s attributable net income stood at P10.482 billion at end-March, higher than the P7.986 billion seen in the same period last year, based on its quarterly report submitted to the local bourse on Friday.

This translated to a return on average equity of 13.13% and a return on average assets of 1.47%, up from 10.27% and 1.24%, respectively, in the prior year.

“Metrobank’s solid performance in the first three months of the year reflects our continued efforts to capture opportunities of a growing economy while we strive to keep our balance sheet strong against risks of volatile market conditions,” Metrobank President Fabian S. Dee said in a statement.

“For the rest of the year, we will continue making progress in further improving our products and services and implement strategies in line with our promise of keeping our customer in good hands,” Mr. Dee added.

The lender’s net interest income rose by 28.85% year on year to P24.869 billion from P19.301 billion “lifted by higher loans and a 54-basis-point hike in net interest margin to 3.9%,” Metrobank said.

The bank saw interest earnings from loans rise by 49.57% to P23.588 billion. Interest income and trading and investment securities also climbed by 89.33% to P10.207 billion.

Meanwhile, other income inched down by 2.32% to P8.126 billion from P8.319 billion.

This, as net gains from trading, securities, and foreign exchange went down by 8.32% to P2.117 billion. Meanwhile, income from service charges, fees, and commissions went up by 13.4% to P4.087 billion from P3.604 billion.

On the other hand, operating expenses grew by 13.53% to P16.895 billion amid higher taxes, increased spending on technology, and transaction-related expenses.

“The strong revenue growth, nonetheless, offset the impact of rising expenses, thus improving the cost-to-income ratio to 51.6% from 54.1% from the year before,” the lender said.

Provisions for credit and impairment losses amounted to P2.39 billion in the first quarter, up by 16.59% year on year.

The bank’s gross loans grew by 12.5% year on year, “driven by a 12.7% rise in commercial loans and 11.8% expansion in consumer loans,” it said.

“Our consumer loans business was mainly driven by a 30% growth in net credit card receivables and 10.7% rise in auto loans,” Metrobank added.

Despite the increase in loans, its non-performing loan (NPL) ratio improved to 1.79% at end-March from 2.16% a year prior.

“Moreover, NPL cover further improved to 189.3%, solidifying the bank’s buffer against any risks to the portfolio,” it said.

On the funding side, deposits grew to P2.36 trillion from P2.22 trillion a year prior. Low-cost current and savings accounts or CASA accounted for 62.1% of total deposits, Metrobank said.

Its loans to deposits ratio rose to 62.78% from 61.87%.

Metrobank’s assets stood at P2.879 trillion as of end-March, up by 8.9% year on year from P2.644 trillion a year prior.

Total equity stood at P319.986 billion, inching up by 5.31% year on year.

Its common equity Tier 1 ratio stood at 16.77% in the first quarter, down from 17.6% the year prior. Its capital adequacy ratio also went down to 17.61% from 18.45%.

Its liquidity coverage ratio was at 237.8%.

As of March 31, the bank had 952 branches, as well as 1,281 automated teller machines (ATMs) in branches and 1,035 ATMs off-site.

Metrobank’s shares rose by P1.30 or 2.20% to end at P60.30 apiece on Friday.

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