Sun Savings Bank increases authorized capital stock
TO continue supporting the tremendous growth of Sun Savings, its stockholders recently filed with Bangko Sentral ng Pilipinas and Securities and Exchange Commission an application to increase its authorized capital stock to P1 billion.
In conjunction with this increase, the stockholders also paid in, as deposits for their additional subscriptions, the amount of P41.7 million last Oct. 17. Once approved, the total shareholders equity is expected to reach a new high of P280 million.
As of the end of the third quarter, the year-on-year growth rate of 30 percent of the bank’s total assets continues to be significant. Total assets reached a level of P1.403 billion as compared to the year-ago level of P1.08 billion.
The growth in total assets was led by loans, which reached P901 million, representing an increase of 24 percent over last year.
Despite the higher-than-industry loan growth, liquid assets consisting primarily of deposits and reverse repurchase agreements (RRA) with the BSP reached a level of P391 million, for a significant increase of 50 percent over the year-ago level of P260 million.
This high liquidity is boosting the bank’s profitability, as the BSP is now paying almost five percent per annum on short term deposits of banks.
Furthermore, the National Government has been borrowing, by issuing short-term Treasury bills at rates of up to 6.5 percent per annum.
The growth in total assets has been driven primarily by the growth in the bank’s deposits, which reached P909 million as of Sept. 30, representing an increase of 28 percent over last year.
The bank is now rewarding depositors with a rate of 6.5 percent per annum tax free, for five-year time deposits, with interest payable one year in advance. This rate compares favorably with the 7.5 percent per annum that is taxable, currently being offered for five-year government fixed-term notes.
The quality of the bank’s loan portfolio continued to improve as non-performing loans (net of provisions) dipped lower to 1.6 percent of the total loan portfolio as compared to the year ago level of 2.2 percent.
The bank opened its Danao City office towards the end of July and immediately attracted customers from Danao City and neighboring towns like Carmen and Sogod. Likewise, residents from Camotes islands have come in, due to its strategic location at the Danao Gateway Mall, which is the port of entry to the Camotes islands.
In the first half of 2019, the bank is targeting to open two more banking offices. The first one will be at Tower 2, at the Solinea condominium complex along Cardinal Rosales Ave. at the Cebu Business Park. Solinea is expected to have 2,500 units across five towers once completed. The second one will be at the corner of Plaridel and Progreso Sts., right across the bustling Carbon Market.
With the two new branches, the bank hopes to continue attracting more of its target market of consumers and small and medium enterprise accounts. (PR)