First Metro Investment Corporation, the investment banking arm of the Metrobank Group, realized a consolidated net income of P1.9 billion at the end of the first half of 2012. This is 76.0% higher than its P1.1 billion profit in the same period last year.
The Treasury Group posted a sizeable net income of P619.0 million or 9.0% higher than its P569.0 million income in the same period last year. The Treasury Group’s income was driven by interest income from fixed income securities, trading gains from the sale of government securities, distribution fee income and brokering fee.
The Investment Banking Group generated a total revenue of P258.0 million which is P40.0 million higher than last year’s income of P218.0 million in the same period. The revenue was generated through various deals that include, SM Prime Holdings’ P7.5 billion Fixed Rate Corporate Notes; Filinvest Land’s P11.0 billion Fixed Rate Bonds; Ayala Corporation’s P10.0 billion Retail Bonds; Ayala Land’s P10.0 billion Retail Bonds; GT Capital Holdings’ P21.6 billion IPO; and FP Finance (2012) Limited’s US$200 million Term Loan.
The Investment Advisory Group realized P160.0 million in net trading gain and dividend income from investment in stocks. This is 3,100% or P155.0 million more than last year’s result of P5.0 million.
First Metro president Roberto Juanchito Dispo explained, "Our first half result was supported by favorable macroeconomic conditions. The debt and equity volume for the first half reached P424.0 billion and First Metro accounted for P291.0 billion or a notable 70.0% market share. In 2011, total capital markets fundraising reached P1.04 trillion and we contributed P805.0 billion or 78.0% of the total funds raised.”
As of June 30, 2012, First Metro’s consolidated resources stood at P75.0 billion, 5.0% lower than the year-end balance of P79.0 billion. The decrease in its resources is mainly brought about by the net effect in deposits due to the change in the reserve requirement on deposit substitute liabilities from 21.0% to 18.0%, net sales of investment securities and net collections of loans and receivables.
Capital funds reached P14.0 billion which is 23.0% or P2.6 billion higher than the end of year balance. Capital adequacy ratio remains competitive at 27.33%.
"The second half of the year poses an even more positive backdrop for the domestic debt capital market with the first quarter GDP at 6.4% and predicted to grow at 7.0% in the second quarter. Inflation is at its record low of 2.8% as of June 2012, historic low rates with 25-year government securities below 6.0%, GIR levels of USD76.0 billion and a surging peso at 41-42 backed by strong OFW remittances and a robust BPO income”, Dispo said.