Listed Security Bank Corp.’s capital strength could weaken over the next one to two years on account of record-high credit costs, S&P Global Ratings warned. “This level of credit costs is significantly higher than industry peers’, with annualized industry credit costs of 180 bps for the first nine months,” S&P further said. It also said Security Bank’s reported gross non-performing loan (NPL) ratio climbed to 4.03 percent in the third quarter of 2020 from 1.44 percent year on year. The credit rater added that it revised down Security Bank’s stand-alone credit profile to “bbb-“ from “bbb” in June this year, reflecting the bank’s weakening asset quality and elevated credit costs amid the material economic fallout from the pandemic. However, elevated credit costs will squeeze the capital position, as well as the rating buffer,” it explained.

Source: Manila Times November 17, 2020 17:03 UTC