2011 Annual Report
innovative solutions Best Bank financialpowerhouse
market mover customer focused Strongest sustainable earnings committed
2011 Annual Report a Vision To be the best bank for all our stakeholders.
Our Mission We aim to be a premier universal bank of international standing, committed to creating and providing the best possible value for our core constituents – clients, employees, shareholders, and the communities whom we serve.
We shall exert all efforts to transform every opportunity to expand our sphere of business activities into instruments to help our constituents realize their own goals and aspirations.
We shall strive to reach a highly diversified customer base through an extensive distribution network at the same time delivering a wide array of premium-value products and services with distinctive quality.
We realize that our success depends on the quality of our people, the efficiency of our systems, and the strength of our organization. Hence, we shall continuously invest in our human resources to ensure a service force characterized by the highest standards of dignity, probity and professionalism.
We shall constantly endeavor to be more responsive to dynamic market conditions, flexible in coping with customer needs, innovative in leading the competition, and united in pursuing common objectives. Our financial capability shall likewise be continually invigorated to maintain dynamism, growth, and stability.
Recognizing our responsibility to our shareholders, we shall exercise judicious management to consistently provide them with fair returns and enhance the value of their investments.
As a responsible corporate citizen, we shall remain committed to making meaningful contributions for the economic and social development of the communities in which we serve.
b Metropolitan Bank & Trust Company BREAKTHROUGH Companies that endure are able to reinvent themselves to stay aligned with customers and markets as they evolve. Metrobank had spent the last few years undergoing such a transformation. In 2011, we made a breakthrough.
We recorded our highest-ever net profit. We remain to be the country’s largest financial powerhouse with a market capitalization close to Php145 billion. And for the second year in a row, Metrobank has been recognized as the “Best Bank in the Philippines” by Euromoney and the “Strongest Bank in the Philippines” by The Asian Banker.*
To be consistent. To be the strongest. To be the best. This is a great time for the Metrobank Group.
And as we mark our 50th year milestone in 2012, our commitment remains: to be the best in everything we do. And for everything we do to make a difference.
*The Euromoney Awards for Excellence 2011 recognized Metrobank’s successful turnaround story, its pursuit of growth, its commitment to improve asset quality, and strong adherence to good governance principles. It is one of the most reputable awards in the finance services industry globally, recognizing 25 global awardees covering 100 countries worldwide. Metrobank was also ranked as the strongest bank in the Philippines and the 20th in Asia Pacific in The Asian Banker 500, a study that tracked the performance of the top 500 banks in the region for 2010. Banks were ranked according to asset size and strength, and based on data from annual reports and statistics provided by the central bank and industry associations.
2011 Annual Report 1 BEYOND BEST BANKING
Once again, we have proven that our fundamental values of trust and teamwork have greatly contributed to the positive outcome of our performance in 2011. We believed that by working together as a group, our potential for success is limitless. This is evident in our breakthrough performance for the year which underscores the very essence of our synergy.
2 Metropolitan Bank & Trust Company BEYOND BEST BANKING 01 Chairpersons’ Message
In so many respects, 2011 was both a challenging and rewarding year.
For the global economy in general, it was another year of uncertainty and volatility. Concerns lingered over the fiscal downturn in the United States and the countries in Europe, the political turmoil in the Middle East and North Africa, and closer to home, the earthquake and tsunami in Japan and flooding in Thailand.
The Philippine economy was not spared the brunt of these market uncertainties and extraordinary challenges. The weakness in major economies dampened the demand for Philippine exports, which were heavily concentrated on electronics. Disruptions in the global supply chain as a result of the natural calamities and disasters and rising oil prices also slowed our economic momentum.
In 2011, our gross domestic product (GDP) expanded 3.7% from the previous year’s 7.6%. Slower growth was attributed to the sharp decline in government infrastructure spending that was only reversed in the last quarter of 2011 when public construction surged by 49.4%.
Still, there were bright spots as well.
Remittances from overseas Filipino workers breached the US$20-billion mark by end- 2011 and buoyed up the retail, real estate, and other sectors. The business process outsourcing industry continued to attract investors. The Philippine stock market outperformed its counterparts in Asia and ranked as one of the best in the world.
Further boosting investor confidence was the series of Philippine credit upgrades in 2011. The country has already received five positive credit ratings from various international agencies since the Aquino administration took office in 2010. These improved ratings translated to reduced borrowing costs for the country and easier access to funds for Philippine companies and individuals.
Challenge of sustainability Against this favorable macroeconomic backdrop, several Philippine banks saw record- breaking revenues in 2011. Even as interest rates further came down, competition among local banks remained fierce and pushed up loan volumes to double-digit growth levels. The frenetic pace of opening new branches and ATMs, and offering alternative banking channels also continued. % As Philippine banks face tighter regulations and more stringent capital requirements under 3.7 GDP growth in 2011 driven by strong the Basel 3 agreements, the quest for growth now becomes a question of sustainability. household consumption spending Philippine banks can no longer rely on spectacular one-off trading gains to sustain the historic profitability they reaped over the past two years.
To be the best bank does not mean to be the most profitable. We must possess all the necessary ingredients of sustainable return on equity, strong balance sheet, high asset quality, and strict adherence to corporate governance standards. 7.2% growth in Philippine Remittances to $20.1b
2011 Annual Report 3 01 Chairpersons’ Message
Barometer of growth In this context, Metrobank becomes an accurate barometer for the Philippine growth story.
Despite the heady days of 2011, Metrobank turned in a strong performance and exceeded our targeted growth, asset health and financial returns. We made solid and steady progress due to the strategic clarity and exceptional efforts of our leadership team, supported by the concerted effort of all our employees.
2011 also turned out to be a milestone year as Metrobank earned the top recognition from two prestigious and independent regional awards for its industry leadership. For the second year in a row, the prestigious Euromoney Awards for Excellence made us the “Best Bank in the Philippines” because of our remarkable turnaround story: growing our assets and profitability while continuing to improve our asset quality and corporate governance practices. Metrobank emerged as one of the 25 global awardees from 100 countries worldwide recognized by Euromoney.
Metrobank was also named the strongest bank in the Philippines and the 20th in Asia Pacific in a study of the top 500 banks in the region by The Asian Banker.
We also continue to derive strength from the growing synergy among the member companies of the Metrobank Group, most of which are also enjoying leadership positions in their respective sectors and industries. In fact, joining us in The Asian Banker study was our subsidiary and thrift-banking arm, Philippine Savings Bank (PSBank), ranked as the fifth strongest bank in the Philippines and the second-largest among local savings banks. Also noteworthy was the biggest contributor to our sustained profitability, First Metro Investment Corporation which continued its dominance in the investment banking sector by arranging landmark capital-raising deals in 2011.
Looking ahead While we still see a bumpy road ahead for the global economy due to lingering uncertainties, we expect Asia to decouple much of its economy from the developed world. However, we do not discount the risks from a possible spillover of the Eurozone crisis, Continued stability in the rising joblessness in the US, slackening export growth, higher oil and gas prices, plunging banking system with commodity prices, and growing volatility in worldwide capital, stock and currency markets. These factors will make us cautiously optimistic in 2012.
Nevertheless, we remain to be better positioned to respond to challenges and grasp 17.3% opportunities as they arise. We expect the pace of regional integration to further accelerate and culminate in the formation of the ASEAN Economic Community in 2015. capital adequacy ratio (as of June 2011) This will make the Philippines well-placed to achieve a more robust economic growth.
Investment in infrastructure will be a key driver in the country’s growth in the coming years. The Philippine government is banking on infrastructure investment resulting from Double-digit industry the Public-Private Partnership model. This will allow us to benefit from major capital loan growth at raising and project financing exercises, particularly in the areas of power, communications, transport, water resources management, among others.
Operating our business in the world’s region of growth will also enable us to meet the % increasingly complex needs of our corporate and individual customers here in Asia 16.4 Pacific. To seize opportunities from rising demand, Metrobank is steadfastly expanding driven by wholesale and retail trade, manufacturing, utilities and real estate, in China, where we envision to grow our presence to 20 outlets in the next five years, renting and business services in addition to our present regional office in Nanjing, our two branches in Shanghai, and
4 Metropolitan Bank & Trust Company To be the best bank does not just mean to be the most profitable. We must also possess all the necessary ingredients of sustainable return on equity, strong balance sheet, high asset quality, and strict adherence to corporate governance standards.
Operating our business in the world’s region of growth will also enable us to meet the increasingly complex needs of our corporate and individual customers here in Asia Pacific.
one representative office in Beijing. We are also reaching out to more Overseas Filipinos worldwide through our remittance partnership with Wells Fargo & Co., a financial institution based in San Francisco, USA.
As we continue to grasp these opportunities, Metrobank will remain well capitalized and ready to face greater competition and increased banking regulations and reforms. We also recognize that leadership entails greater responsibility to society so we are invigorating our corporate social responsibility programs through the Metrobank Foundation and moving toward its greater integration into our business.
On behalf of the Board of Directors, we would like to express our gratitude to all customers, shareholders, suppliers and business partners for their consistent support that make Metrobank the best Philippine banking institution. We will continue to sustain this achievement through the passion and commitment of our management team and employees who always rise to the occasion with courage and determination, and ultimately made every year a success for Metrobank.
George S.K. Ty Antonio S. Abacan, Jr. Group Chairman Chairman
2011 Annual Report 5 02 President’s Report
This year’s performance was achieved on the back of sustained growth in revenues while keeping asset quality in check. Committed to our long term strategy of building a quality bank, we will continue to work on improving profitability and efficiency, capitalizing on market opportunities in line with the expected growth in the Philippine economy.
31.9% growth to P11.0 b in consolidated net income
6 Metropolitan Bank & Trust Company progression of success
In 2011, the Philippine economy slowed down to a 3.7% GDP growth, coming from 2010’s historical 7.6% growth. This was mainly due to weaknesses in exports and government spending even amid the strong private consumption.
Meanwhile, the banking industry remained strong and resilient. Sector-wide growth in loans, deposits, and profits were generally healthy, while asset quality remained intact as NPL ratio hit 2.2%, the lowest since the 1997 Asian financial crisis.
In the advent of Basel 3 and the expected changes on capital requirements, many banks raised equity last year, further increasing the industry’s capital adequacy ratio to over 17%.
Despite the economy’s sluggish performance, Metrobank capitalized on organic growth and reported consolidated net income of Php11.0 billion, a 31.9% increase over the same period last year, and the highest recorded profit by the Metrobank Group. Consequently, return on average equity further improved to 11.2%, from the previous year’s 10.3%. We have exhibited consistent and sustainable growth, as the trajectory of our returns continues to show improvement. Loan Breakdown We ended the year with Php958.4 billion in total resources, or 8.0% higher than in 2010. This was supported by the 4.6% growth in the deposit base to Php681.0 billion. Net loans and receivables likewise expanded to Php457.4 billion, posting double-digit growth of 16.5% on the back of sustained demand in consumer loans, as well as the resurgence in the middle market and corporate segments. 27.1%
In 2011, we successfully completed a Php10.0 billion stock rights offer, which, coupled with earnings for the year, increased our total equity to Php109.8 billion, still the highest 72.9% in the industry. This pushed our capital adequacy ratio to 17.4%, and the Tier 1 ratio to 13.7%.
Total revenues grew 4.8%, breaching the Php50.0 billion mark. This was mainly driven by improving margins and steady growth in fee income. Commercial Consumer Net interest income grew 11.4% to Php29.4 billion, as net interest margin improved by 11 basis points to 3.5% despite pressure on asset yields and strong competition for funds.
Meanwhile, non-interest income (including share in net income of associates and a joint venture) was slightly down to Php21.0 billion, from the Php21.7 billion recorded last year. deposit Breakdown Group-wide profit from securities and foreign exchange trading was better than expected at Php7.7 billion. Service fees, charges and commissions were stronger, increasing by 11.4% almost Php1.0 billion or 12.5% growth to Php7.7 billion.
Operating expenses increased by 10.3% to Php30.7 billion, driven mainly by manpower- related costs, which can be partly explained by the consolidation of Metrobank 47.0% Technology Inc. into the Parent Bank. 41.6%
Consolidated net loans and receivables, net of allowance for credit losses, grew by 16.5% or an increment of Php64.8 billion, to end the year at Php457.4 billion. Commercial loans (i.e. combined corporate and middle market portfolio) registered a 19.2% growth for an additional Php53.4 billion, the highest recorded growth in the last 5 years. growth to demand Meanwhile, consumer loans sustained its momentum, posting double-digit increases savings across all three sectors: home mortgages, auto financing, and credit card receivables. time Overall, the Group’s consumer loan portfolio increased by 18.0% to Php123.0 billion.
2011 Annual Report 7 02 President’s Report
While 2011 was one of the best years for credit growth, this was balanced by keeping asset quality in check. At yearend, non-performing loans (NPL) ratio further improved to 2.2% from 2010’s 2.9%, on the back of Php0.9 billion reduction in gross NPLs. Loan loss cover was increased to 99.5% from 92.3%, as we set aside provisions for impairment and credit losses amounting to Php3.8 billion. As a result of our clean-up efforts in the past five years, credit costs have substantially come down. Total investment properties, which consist of foreclosed real estate properties and investments in real estate, decreased by Php2.9 billion to Php15.5 billion in 2011.
On fund generation, total deposits grew by Php29.7 billion to Php681.0 billion, driven by the Php24.4 billion incremental in current and savings accounts or CASA. CASA now accounts for 53.0% of total deposits from only 51.6% in 2010. With the continuous improvement in the deposit mix, the average cost of deposit remained the lowest versus peers at 1.5%.
The global financial markets remained largely volatile in 2011, which posed a challenge to most banks’ treasury businesses. For Metrobank, the mitigating strategy was to push for more customer-driven business across the top three segments of corporates, wealth management, and retail clients. For the third year in a row, we remained the best performing local government securities dealer in the primary and secondary market as ranked by the Bureau of Treasury. For the P958.4b full year, our trading and foreign exchange profits hit Php7.7 billion, the highest among our peers. In our trust business, Metrobank’s assets under management posted the highest growth at stronger in consolidated assets growing by 41.0% to Php382.1 billion, vis-à-vis our closest competitors. This translated to a 44.8% growth in group-wide income from trust operations to Php695 million.
We continued to invest in our network infrastructure to make banking more accessible and convenient to our valued clients. Metrobank opened a total of 33 branches in 2011, bringing the P71.1b consolidated network to 785 local branches and 1,581 ATMs across the country. from the previous year In strengthening our international presence, we expanded our network with the additional remittance correspondents and agents. By yearend, our network is composed of 39 foreign branches, subsidiaries and representative offices, 97 remittance correspondents and 161 remittance agents, across 27 countries. With this infrastructure, the value of total remittances Largest capitalized bank coursed through the Bank reached US$2.8 billion, growing by 21.1% from the 2010 levels, and in the industry with widely eclipsing the industry’s growth of 7.2%.
Metrobank’s success lies in its strong franchise and the synergy of the Group. This has been P109.8b instrumental in promoting our cross-selling efforts and deepening client relationships. in total equity Our investment banking arm, First Metro Investment Corporation, reported consolidated net income of Php2.2 billion, or a 28.8% growth from 2010 levels. It remains to be the dominant player in the domestic debt capital market, having participated in 77.6% of the total peso- denominated issuances in 2011. Philippine Savings Bank, our thrift bank subsidiary, has been recognized this year as the Strongest Savings Bank in the Asia Pacific region, and the 5th Strongest Bank in the country by The Asian Banker. It posted a record breaking net income of Php2.0 billion, representing a 12.2% year-on-year growth. Our credit card subsidiary, Metrobank Card Corporation, recorded a solid growth of 62.9% in net profit after tax amounting to Php1.4 billion.
Meanwhile, ORIX Metro Leasing and Finance Corporation registered consolidated after tax profits of Php400.4 million. In bancassurance, AXA Philippines is now the leading variable life insurance provider for investment-linked products and the third largest life insurer in the country. Philippine Charter Insurance Corporation, remains to be among the top 5 insurance companies in terms of net premiums written.
Toyota Motor Philippines Corporation managed to maintain its 38.6% market share despite the crises in Japan and Thailand, ending the year with Php2.2 billion in net income. For the 10th consecutive time, TMPC won its 10th Triple Crown, topping overall sales of passenger and commercial vehicles.
Achieving operational efficiency and enhancing productivity remain one of our key priorities.
8 Metropolitan Bank & Trust Company We’re very honored to be recognized by Euromoney for the second year in a row. This is not only a breakthrough in affirming our leadership, but also a strong testament to the unwavering support of our clients, the efforts of a strong management team, and our continued pursuit to be the best bank for all our stakeholders.
To enhance customer service experience, we took on process improvements and streamlined projects that resulted in improved Service Level Agreements (SLAs). Some of these initiatives include the Revised Check Clearing System and the roll-out of Trade Document Imaging System. Alongside, we also had a major technology refresh through replacements of desktop computers with newer hardware models. We updated operating systems translating to faster system response times, easier administration, and improved productivity.
In support of our overseas operations, we implemented a new core banking system in our Korea branch to strengthen capabilities for capturing bigger deposits and OFW remittance markets. Likewise, we implemented a new suite of systems allowing more remittance origination and distribution points, and providing superior features and conveniences for customers and their beneficiaries.
We recognize that our people will be a key differentiating factor in implementing our customer focused strategy. To this end, we continued to invest in training and employee development and implemented career retention initiatives for high potential and key employee segments.
One of the highlights of 2011 was the awards and recognitions from prestigious global publications. Metrobank was recognized as the Strongest Bank in the Philippines by The Asian Banker, and the 20th Strongest in the Asia Pacific region. And for the second consecutive year, we were awarded the Best Bank in the Philippines by Euromoney. Once again, these awards are a testament to the positive direction by which we are steering this bank, and they serve as both an inspiration and a challenge to work harder to uphold shareholder value.
Against a backdrop of a still uncertain global economic landscape, we could expect another challenging year for the Philippine economy. Hopes for a better economic performance in 2012 are largely hinged on expectations that the government will make up for its huge underspending in 2011. However, prospects for emerging economies, including the Philippines, remain relatively positive, and the banking industry is poised for a resurgence in credit demand on the back of the expected shift in the country’s infrastructure development.
On behalf of Metrobank’s management and shareholders, I would like to extend my gratitude to our people for their continued dedication and hard work, and to our valued customers for their unwavering support in their trusted banking partner.
Arthur Ty President
2011 Annual Report 9 SOLID PERFORMANCE
Group Financial Highlights in million pesos (except per share amounts)
Increase (Decrease) 2011 2010 Amount % At Year End Total Assets 958,384 887,323 71,061 8.01% Trading and Investment Securities 196,702 171,710 24,992 14.55% Loans and Receivables, net 457,422 392,659 64,763 16.49% Deposit Liabilities 680,993 651,262 29,731 4.57% Subordinated Debt 19,735 21,673 (1,938) (8.94%) Equity Attributable to: Equity Holders of the Parent Company 109,798 87,634 22,164 25.29% Non-controlling Interest 6,706 5,383 1,323 24.58% Book Value Per Share 49.00 42.53 6.47 15.21% Foreign Exchange PDS Closing Rate 43.84 43.84 PDS Weighted Average Rates 43.31 45.12 (PDS: Philippine Dealing System)
+32% +16% Net Income (in billion pesos) Net Loans & Receivables (in billion pesos)
09 6.0 09 362.3
10 8.4 10 392.7
11 11.0 11 457.4 +22% Earnings Per Share (in pesos) Non-Performing Loans Ratio (in percentage)
09 3.0 09 3.6
10 4.1 10 2.9
11 5.0 11 2.2
10 Metropolitan Bank & Trust Company SOLID PERFORMANCE
Increase (Decrease) Increase (Decrease) 2011 VS 2010 2010 VS 2009
2011 2010 2009 Amount % Amount % For the Year Net Interest Income 29,407 26,390 26,679 3,017 11.43% (289) (1.08%) Other Operating Income 19,573 20,092 16,081 (519) (2.58%) 4,011 24.94% Total Operating Income 48,980 46,482 42,760 2,498 5.37% 3,722 8.70% Provision for Credit and Impairment Losses 3,823 7,285 8,793 (3,462) (47.52%) (1,508) (17.15%) Other Operating Expenses 30,680 27,818 25,842 2,862 10.29% 1,976 7.65% Total Operating Expenses 34,503 35,103 34,635 (600) (1.71%) 468 1.35% Share in Net Income of Associates and A Joint Venture 1,437 1,618 919 (181) (11.19%) 699 76.06% Provision for Income Tax 3,524 3,731 2,249 (207) (5.55%) 1,482 65.90% Net Income 12,390 9,266 6,795 3,124 33.71% 2,471 36.36% Attributable to: Equity Holders of the Parent Company 11,031 8,366 6,029 2,665 31.86% 2,337 38.76% Non-Controlling Interest 1,359 900 766 459 51.00% 134 17.49% Basic/Diluted Earnings Per Share Attributable to Equity Holders of the Parent Company 5.02 4.11* 3.01* 0.91 22.14% 1.10 36.54%
*Restated to show the effects of stock rights granted in 2010
+25% Equity (in billion pesos) Tier 1 (%) Total CAR (%)
09 75.2 10.0 14.3
10 87.6 12.0 16.4
11 109.8 13.7 17.4
2011 Annual Report 11 wide network Performance ahead of the curve growth partner top performer Record breaking consistent convenience banking efficient
12 Metropolitan Bank & Trust Company 03 Performance Highlights
wide network
In January, Metrobank concluded its Php10 billion stock rights offering with the listing ceremony at the Philippine Stock Exchange ( Makati ). Conducting the traditional ringing of the bell were Metrobank founder and Group chairman, Dr. George S. K. Ty (4th from left) and Philippine Stock Exchange chairman, Atty. Cornelio Peralta (5th from left), with (from left to right) Metrobank vice chairman and First Metro Investment Corp. president, Francisco Sebastian; Metrobank president, Arthur Ty; Metrobank chairman and Group vice chairman, Dr. Antonio S. Abacan Jr.; BSP Governor Amando Tetangco, Jr.; National Treasurer Roberto Tan; SEC Chairperson Hon. Fe Barin; and PSE president and CEO, Hans B. Sicat.
Commercial Banking Growth partner
The robust expansion of Philippine companies in 2011 provided significant opportunities for Metrobank’s commercial banking business. Its strength lies in providing innovative corporate banking and cash management services, as well as client-specific solutions, executed with seamless delivery for an enriching customer experience.
Commercial Banking remains a core business focus for Metrobank. The Bank provides clients with wholesale banking services such as loans, corporate finance, cash management, trade services and structured finance.
In step with increased economic activity and healthy credit growth, Metrobank extended new commercial loans amounting to Php53.4 billion or 19.2% growth from the previous year. The Bank supported clients in the growth areas of the economy, which include the utilities, real estate, manufacturing, and service-related sectors.
The year also saw Metrobank strengthening its share of trade-related financing, with commercial letters of credit (LCs), standby LCs, bank guarantees, and Non-LCs reaching US$3.1 billion while value of export transactions increased to US$1.6 billion.
2011 Annual Report 13 03 Performance Highlights
Despite the slowdown in Philippine export volumes in 2011, Metrobank’s trade portfolio grew 16% while the volume of foreign exchange and derivatives products increased 27%.
Metrobank helps corporate clients effectively manage their liquidity and funding needs through convenient Cash Management solutions. Assisting clients in handling their collection and disbursement processes not only raises their business productivity, but also 388 enables the Bank to deepen its customer relationships through cross-selling opportunities. new cash management clients
This strategic approach contributed to the 36.0% growth in bank deposits generated by the Cash Management business, as a total of 388 new clients signed up for the year. Business volume growth benefited from intensified marketing efforts in the branches and the significant growth in online usage. The number of registered corporate enrollees in metrobankdirect grew 78% from the previous year’s level, while the number of metrobankdirect multiple-product users quadrupled in 2011.
Retail Banking Fulfilling DREAMS
As the Philippine economic landscape is predominantly consumption-driven, Retail Banking presents long-term growth potential, on the back of rising income levels, resilient remittance flows, and favorable demographic profile. This segment will continue to be a major business driver for Metrobank as we focus on consumer banking products that provide good value to our clients.
Metrobank offers retail services including deposits, bills payment, mortgage and vehicle financing, and credit cards. To ensure convenience and accessibility, customers can rely on our extensive network of domestic branches and ATMs across the archipelago, as well as our internet and mobile banking facilities.
Consumer Loan Breakdown Strong network of (in percentages) 785 09 25.6 36.9 37.5 BRANCHES and 10 23.8 40.4 35.8 1,581 11 24.1 39.9 36.0 ATMs across the country Credit Cards, Others Auto Loans Housing Loans
14 Metropolitan Bank & Trust Company Consumer loan portfolio growing by
18.0% with the expansion across all segments: housing, auto and credit card receivables
CASA accounting for 53.0% of total deposits
P681.0 b in total deposits
The branches serve as an integrated channel for deposit taking, retail loan origination, 7. 3 % product distribution, as well as the focal touch point for customer service. In 2011, CASA growth to P361 billion Metrobank expanded its consolidated branches nationwide to 785 with the opening of 33 new branches at yearend. Total ATM network also increased to 1,581, with 223 new ATMs added. Through these banking channels, the Bank was able to deepen its relationship with customers and created more opportunities for cross-selling. As a result, consolidated deposits grew by 4.6% to Php681.0 billion from the 2010 levels. More importantly, total current and savings accounts or CASA increased by 7.3% to Php360.6 billion, accounting for 53.0% of total.
In 2011, Metrobank remained one of the leading consumer lenders across the industry, with a consolidated portfolio of Php123.0 billion, representing 18.0% growth from the previous year. Sales performances of MetroHome and MetroCar, the two main consumer loan products, continued to be strong, largely as a result of the prevailing low interest rates, rising affordability levels, and marketing and promotional campaigns like the 2011 Great Rates Sale. Intensified sales efforts by the extensive branch network and optimized utilization of conduit channels likewise influenced volume growth.
Housing loans surged by 18.6% to Php44.3 billion, from Php37.3 billion a year ago. Specifically, MetroHome sales volume was influenced by the implementation of the direct mailer campaigns, and competitive rate offerings for developer tie-up arrangements. Meanwhile, auto loans grew by 16.7% even as car sales weakened due to the supply chain bottlenecks created by the calamities in Japan and Thailand. Both housing and auto loans comprise 36.0% and 39.9%, respectively, of Metrobank’s total consumer portfolio.
2011 Annual Report 15 03 Performance Highlights
Wealth Management Optimize returns
2011 saw the global financial markets unnerved by a host of negative external developments. The dramatic shifts in risk appetite amid a worsening Eurozone debt crisis situation and a slowing global economic growth, coupled with the tight monetary policy stance on heightened inflationary pressures, affected most banks’ treasury businesses.
Amid market volatilities, Metrobank recorded better-than-expected income from its Treasury
382.1 business, as income from trading and foreign exchange activities hit Php7.7 billion. This is partly due to increased customer-driven flows, with good initiatives set up in our corporate, wealth management, and retail segments. Revenues were boosted by sales of treasury
271.0 products such as foreign exchange products for hedging currency risk, and interest rate derivatives like options and swaps. Likewise, the Bank continued to be active in both the government and corporate bond segment, and for 2011, it remained the Best Performing 210.3 Local Government Securities Eligible Dealer in the primary and secondary market.
Metrobank’s Trust business remains focused in delivering premium service and providing a diverse range of wealth management products to high-net worth clients, as well as retail and 09 10 11 corporate customers. Assets under Management The Bank posted 37% growth in new corporate trust accounts, 33% in new personal trust (in billion US dollars) accounts, and 13% new escrow and other fiduciary accounts handled in 2011.
16 Metropolitan Bank & Trust Company As a result, the Bank’s assets under management (AUM) grew 41.0% to Php382.1 billion – the fastest growth among the top three players in the industry. This was driven by intensified marketing efforts, operational enhancements, restructuring of marketing units to integrate sales and servicing functions by market segment, and institutionalizing service level standards for a delightful customer experience.
Despite market uncertainties, the Bank managed to deliver superior track record in fund performance. Metrobank ranked No. 1 Fund Manager in the year-on-year All Trusteed category of the latest Towers Watson Survey on Investment Performance of Retirement P7.7b Funds – delivering the highest average return over the last 5 years. better-than-expected income from trading and foreign exchange
International Banking bridging relationships
Metrobank’s Remittance Business is focused on meeting the banking needs of the country’s Overseas Filipinos (OFs) and their families.
In 2011, total remittances from OFs breached the US$20-billion mark despite lingering uncertainties in the Middle East, the US, and Europe. In fact, the Philippines is poised to become the world’s third-largest market for remittances as over 9 million OFs worldwide are expected to further increase in the coming years.
Metrobank continued to be a steady partner of the country’s “modern-day heroes” as its remittance volume outpaced the industry’s growth. As of December 2011, remittances coursed through Metrobank grew by 21.0% in terms of value, or three times the industry’s 7.2% performance.
20.1 18.8
17.3
09 10 11
Philippine Remittances Value (in billion US dollars)
2011 Annual Report 17 03 Performance Highlights
To further reach out to more Filipinos abroad, Metrobank established 15 more remittance Metrobank Remittances correspondents in the Middle East, Europe and the Asia Pacific, bringing the total to 97 by 1.1% year-end. It also forged new tie-ups with major international money transfer companies such as MoneyGram, Wells Fargo Bank, and Uniteller, effectively expanding its presence worldwide. MoneyGram has outlets in 192 countries. Uniteller has 2,000 agent locations and 23.3% Wells Fargo Bank has 9,000 outlets across America. More agent arrangements were added 31.5% especially in the United States, Canada, Hong Kong, and Italy, for a total of 161 agents at 9.4% year-end.
34.6% To provide better service to OFs, Metrobank launched a system interface that enabled its partners to send remittances almost real-time. It also offered a remittance service called americas Cash Pick-up Anywhere where money can be sent and claimed within seconds using only europe a single reference number at over 3,500 payout locations including Metrobank’s 785 local asia branches, M. Lhuillier and Cebuana Lhuillier pawnshops, and Globe G-Cash outlets. middle East others Cognizant of the potential of the China market, its wholly owned subsidiary, Metropolitan Bank (China) Ltd., increased its branch presence to four in 2011 with the opening of a new branch in Changzhou.
People and Technology service Excellence Ongoing investment in IT systems allows Metrobank to benefit from technological innovation, improve its ability to meet evolving business needs, and deliver on customer service expectations and efficiency demands. The major initiatives undertaken during the year was to harness document-imaging technologies, particularly for processing international trade documents, a new suite of IT solutions to allow more remittance origination and distribution points, and provide superior features and conveniences for customers and their remittance beneficiaries.
Metrobank’s continued success depends on its people. To meet the Bank’s business goals, it is continuously creating an organization that attracts, retains and develops the best talent in the industry. The Bank is also putting a premium on employee engagement, recognizing that engaged employees are more motivated to understand customer needs and deliver outstanding service. It is likewise committed to professional development and creating learning opportunities that allow employees to reach their full potential.
18 Metropolitan Bank & Trust Company Backroom support to the Bank’s business units, the Operations Group embarked on several initiatives in 2011 to enhance customer service experience and business productivity through process improvements and streamlining of projects. These initiatives led to improvements in Service Level Agreements (SLAs) from mere “Customer Satisfaction” to “Customer Delight.”
Operations has effectively implemented Revised Check Clearing System and the rollout of the Trade Document Imaging System (TDIS). Metrobank is the first local bank to implement TDIS that improved process flow and made trade processed products available to marketing units and clients on a real-time basis.
The Bank’s status was reinforced among foreign correspondent banks as a leading commercial payment partner bank. Its International Operations Division received several awards for its Straight-Through Processing (STP) for outgoing remittances.
2011 Annual Report 19 financialintegrity Transparency judicious management accountability compliance culture
20 Metropolitan Bank & Trust Company 04 Governance
upholding integrity At Metrobank, we believe that leadership entails responsibilities. This is why we take our commitment to upholding the highest standards of corporate governance seriously. It is an important ingredient in being the best bank.
Internal Audit high ethical standards
Our Internal Audit Group (IAG) provides independent and objective assessment, and recommendations on the organization’s risk management, internal controls, and governance processes. The results of its assurance and consulting activities, combined with those of other control and monitoring units of the Bank, are communicated to Management and the Board of Directors through the Audit Committee.
In 2011, the IAG laid out a comprehensive risk-based audit plan to assess the adequacy, efficiency, and effectiveness of the Bank’s internal control structure, safeguarding and utilization of assets, and Management’s performance in carrying out assigned responsibilities. IAG’s assessment found that the internal controls, risk management and governance processes were adequate and generally operating effectively in relation to business objectives, and that there were no material weaknesses and risks beyond the Bank’s risk tolerance level.
2011 Annual Report 21 04 Governance
Assurance and consulting activities were expanded: • Independent risk model validation was performed on in-house developed models/ calculators for certain Treasury and Trust products; • Project audit was formally started, covering major information technology initiatives; • Continuous enhancements of audit rating systems, which provide a clear measure and standard for evaluation as accepted by management, were completed for major groups; • As part of enterprise-wide risk management, oversight on internal audit activities of the Metrobank Group was strengthened through periodic coordination and reviews to align audit goals and strategies; • Comprehensive analysis of outstanding audit observations was provided to emphasize the need for management’s prompt action and to provide recommendations on necessary policy enhancements; and • Bank-wide risk and controls awareness programs were actively supported.
In October 2011, independent auditing firm Punongbayan & Araullo confirmed to Senior Management, the Audit Committee, and the Board of Directors that the IAG “generally conforms” (the highest classification on conformity) to the International Standards for the Professional Practice of Internal Auditing (ISPPIA), the Code of Ethics, and the Definition of Internal Auditing.
As embodied in the strategic plan, audit processes will continually be enhanced, auditors’ skills upgraded, and assurance and consulting services expanded. IAG will “Challenge Status Quo” and encourage proactive management participation in this endeavor.
SENIOR EXECUTIVE COMMITTEE EXECUTIVE COMMITTEE Adviser George S.K. Ty, Metrobank Group Chairman Adviser James Go, Vice Chairman, Board of Advisers
Chairman Antonio S. Abacan, Jr., Chairman Chairman Antonio S. Abacan, Jr., Chairman
Vice Chairman Arthur Ty, President Vice Chairman Arthur Ty, President
Members James Go, Vice Chairman, Board of Advisers Members Fabian S. Dee, Head, National Branch Banking Sector Mary V. Ty, Assistant to the Group Chairman Mary V. Ty, Assistant to the Group Chairman Fabian S. Dee, Head, National Branch Banking Sector Vicente R. Cuna, Jr., Head, Corporate Banking Group Vicente R. Cuna, Jr., Head, Corporate Banking Group Ma. Corazon B. Nepomuceno, Deputy Head, Credit Group Fernand Antonio A. Tansingco, Head, Treasury Group Eligio C. Labog, Jr., Head, Branch Lending Group Benedicto C. Legaspi, Head, Credit Group Secretary Rosanna F. De Vera, Head CRG CREAD-MM Commercial Rotating Members Francisco C. Sebastian, Vice Chairman Edmund A. Go, Director Robin A. King, Independent Director
Secretary Noel Peter Z. Yuseco, Head, CRG CREAD Corporate
22 Metropolitan Bank & Trust Company Audit Committee The Audit Committee assists the Board in fulfilling its statutory and fiduciary responsibilities, enhancing shareholder value, and protecting shareholders’ interest.
In discharging its responsibilities, the Audit Committee has explicit authority to investigate any matter within its terms of reference; full access to and cooperation by Management; full discretion to invite any director or executive officer to attend its meetings; and adequate resources to enable it to effectively discharge its functions.
The Committee is composed of three Board members (all independent directors) and one Board adviser. These members have the necessary technical competencies as required by regulations. The Chairman of the Board also acts as adviser of the Audit Committee.
The Audit Committee exercises its role in good corporate governance and enterprise- wide risk management and meets at least once a month and as the need arises to discuss audit scope and strategies, highlights of audit results, significant and emerging risks, management’s action plans and status, and other audit-related matters.
Our internal controls, risk management and governance processes were adequate and generally operating effectively in relation to business objectives.
AUDIT COMMITTEE Adviser Antonio S. Abacan, Jr., Chairman
Chairman Renato C. Valencia, Independent Director
Vice Chairman Remedios L. Macalincag, Independent Director
Members Vicente B. Valdepeñas, Jr., Independent Director Cornelio C. Gison, Adviser
Resource Persons Fabian S. Dee, Head, National Branch Banking Sector Joshua E. Naing, Head, Controllership Group Bernardito M. Lapuz, Head, Risk Management Group
Secretary Diana Lou N. Mendez, Head, Audit Quality Assurance Department
2011 Annual Report 23 04 Governance
Compliance Division strong compliance culture
Metrobank believes that compliance is the responsibility of everyone in the organization. Consistent with its mandate to create a robust compliance culture, the Bank ensures that the entire organization – from the Board of Directors, Senior Management and its employees – consistently complies with applicable laws, rules, regulations and standards.
The Board ensures that a Compliance Program is defined and that compliance issues are resolved expeditiously. This Program sets out planned activities, compliance risk identification and assessment, compliance testing and training on compliance matters.
Through its Corporate Governance Committee, the Board oversees adherence to the Compliance Program while Senior Management ensures that all personnel and affiliated parties meet the compliance standards of the Bank.
Reporting directly to the Corporate Governance Committee is the Compliance Division, the lead unit that administers the Compliance Program and interacts with regulatory agencies on compliance-related issues. The Division is an independent body that oversees the design of the Bank’s compliance system, promotes its effective implementation and addresses breaches that may arise.
The key functions of the Compliance Division include the following: • Proactively identifying, measuring, and assessing emerging compliance issues and key compliance risks; • Performing sufficient and representative compliance testing and periodic independent verification to assess Compliance Program’s effectiveness; • Providing advice and support to Management in managing regulatory and compliance risk; • Conducting regular compliance and awareness trainings for all employees, and having an effective upstream and downstream communication within the Bank to address compliance matters; and • Reporting compliance issues to appropriate levels of management and to the Board of Directors through the Corporate Governance Committee.
24 Metropolitan Bank & Trust Company In 2011, the Compliance Division was reorganized to enhance monitoring and oversight in the implementation of the Bank’s Compliance Program, as well as that of the compliance functions of the Trust Banking Group, Metrobank’s domestic and foreign subsidiaries, foreign branches and other international offices.
It continued to boost the compliance culture and awareness in the Bank by updating annually the Compliance Program; developing and implementing formal compliance/ regulatory training of personnel, as well as regular issuances of informal tools of compliance learnings; providing active advisory services on compliance matters/ queries; and vigorously promoting adherence to corporate governance principles and best practices.
Risk Management strict adherence The Risk Management Group (RSK) is an independent unit of the Bank that identifies, analyzes, measures and monitors credit, market, liquidity and operational risks, in close coordination with other business units.
RSK reports directly to the Board of Directors through the Risk Management Committee (RMC) which is composed primarily of independent members of the Board. RMC’s active role in overseeing the Bank’s risk infrastructure, operating policies and exposures ensures consistency among strategies, risk appetite and prudence.
RISK MANAGEMENT COMMITTEE Chairman Remedios L. Macalincag, Independent Director
Vice Chairman Edmund A. Go, Director
Members Renato C. Valencia, Independent Director Jesli A. Lapus, Independent Director Vicente B. Valdepeñas, Jr., Independent Director Cornelio C. Gison, Adviser
Resource Persons Fernand Antonio A. Tansingco, Head, Treasury Group Fabian S. Dee, Head, National Branch Banking Sector Vicente R. Cuna, Jr., Head, Corporate Banking Group Joshua E. Naing, Head, Controllership Group Richard S. So, Head, International Offices and Subsidiaries Group Benedicto C. Legaspi, Head, Credit Group Maritess B. Antonio, Head, Internal Audit Group Head, Operations Group
Secretary Enrique Gregorio, Head, Risk Strategic Support Division
2011 Annual Report 25 04 Governance
corporate GOVERNANCE COMMITTEE Chairman Remedios L. Macalincag, Independent Director
Vice Chairman Francisco C. Sebastian, Vice Chairman
Members Placido L. Mapa Jr., Chairman, Board of Advisers Antonio S. Abacan, Jr., Chairman Robin A. King, Independent Director Jose P. de Jesus, Independent Director
Corporate Amelia S. Amparado, Compliance Officer Governance Officer
Secretary Susan M. Paraguya, Officer, Legal Services Department
RELATED PARTY TRANSACTIONS COMMITTEE Chairman Renato C. Valencia, Independent Director
Members Remedios L. Macalincag, Independent Director Vicente B. Valdepeñas, Jr., Independent Director Maritess B. Antonio, Head, Internal Audit Group
Secretary Amelia S. Amparado, Compliance Officer
In 2011, RSK embarked on several Bank-wide initiatives to further strengthen risk management processes and procedures. These were the following:
Credit Risk Management To ensure prudent credit risk management, RSK further enhanced its credit review framework by implementing more stringent selection and scoring methods. It also continuously improved credit portfolio reports for both the Bank and the Metrobank Group to provide management with better insights on pertinent portfolios.
RSK actively participated in various credit risk-related automation projects, namely: the evaluation and review of vendors for the Credit Risk Management System and the testing of an automated Credit Approval System and Financial Spreading and Risk Rating Engine. Likewise, it continued to undertake data gathering and preparation for credit risk modeling requirements in line with the Bank’s Basel 2 roadmap.
In addition, RSK proactively reiterated existing and developed new credit policies found unclear or deficient in the Bank’s existing processes.
26 Metropolitan Bank & Trust Company Market and Liquidity Risk Management In 2011, RSK provided support to the Treasury Group in securing additional derivatives licenses from the Bangko Sentral ng Pilipinas by instituting risk measures and developing risk systems.
RSK also worked on the implementation of a new market and liquidity risk management system to replace and upgrade the current system. It also strengthened channels of risk management and control, communication, coordination and oversight across Head Office, overseas branches, and domestic subsidiaries.
Operational Risk Management Moving towards advanced risk estimation approaches, RSK further enhanced its Risk and Control Self Assessment tool in 2011 to include estimated potential loss measurements as part of its groundwork in the capital calculation for operational risk. The tool was adopted by more Bank units, including those that are geographically disparate.
DOMESTIC EQUITY INVESTMENTS COMMITTEE Chairman Robin A. King, Independent Director
Vice Chairman Antonio S. Abacan, Jr., Chairman
Members Francisco C. Sebastian, Vice Chairman Jesli A. Lapus, Director Maritess B. Antonio, Head, Internal Audit Group Jose P. de Jesus, Independent Director
Resource Person Joshua E. Naing, Head, Controllership Group
Secretary Rose Mary T. Reyes, Head, Domestic Subsidiaries Division
NOMINATIONS COMMITTEE Chairman Renato C. Valencia, Independent Director
Members Francisco C. Sebastian, Vice Chairman Robin A. King, Independent Director
Secretary Mariquita L. Agena, Assistant Corporate Secretary
2011 Annual Report 27 04 Governance
In addition, RSK also initiated the following in 2011: • Developed an e-Learning module as part of its risk awareness program to reach a wider scope of audience; • Enhanced the risk incident reporting process to ensure more effective monitoring and management of risks; • Expanded the data collection coverage to improve its risk reporting of the Bank’s potential and actual loss exposures based on the seven loss event categories identified under Basel 2; • Improved its Business Continuity Program for the Bank to become more resilient when facing diverse threats or actual crisis situations; required quantifications of potential failures in its Business Impact Analysis, introduced a bankwide notification process and defined the bank’s strategies in prioritizing its resumption activities.
MBTC Group Initiatives In 2011, RSK also focused on forging closer coordination and cooperation within the Metrobank Group.
It led the alignment of credit policies within the MBTC Group and shared the process of conducting credit risk review, impairment and classification processes with the subsidiaries and affiliates. Consultation on various credit risk-related concerns was also encouraged to promote consistency of interpretation and application.
For market and liquidity risk, officers from overseas branches and subsidiaries underwent risk training conducted by Head Office personnel to upgrade their risk management capabilities. RSK also harnessed the synergy within the Metrobank Group by promoting a healthy exchange of ideas, methodologies and practices on market and liquidity risk management among subsidiaries and affiliates.
TRUST COMMITTEE Adviser James Go, Vice Chairman, Board of Advisers Placido L. Mapa Jr., Chairman, Board of Advisers
Chairman Jesli A. Lapus, Independent Director
Vice Chairman Francisco C. Sebastian, Vice Chairman
Members Antonio S. Abacan, Jr., Chairman Arthur Ty, President Manuel Q. Bengson, Independent Director Josefina E. Sulit, Head, Trust Banking Group
Secretary Josefina T. Tuplano, Deputy Head, TBG Trust Business Development Division
28 Metropolitan Bank & Trust Company OVERSEAS BANKING COMMITTEE Adviser Mary V. Ty, Assistant to the Group Chairman Antonio S. Abacan, Jr., Chairman
Chairman Robin A. King, Independent Director
Vice Chairman Francisco C. Sebastian, Vice Chairman
Members Arthur Ty, President Manuel Q. Bengson, Independent Director Joshua E. Naing, Head, Controllership Group Richard S. So, Head, Int’l Offices & Subsidiaries Group Maritess B. Antonio, Head, Internal Audit Group Helen U. Fargas, Deputy Head, National Branch Banking Sector
Resource Person Jovencio R. Capulong, Head IOSG Remittance Operations Division
Secretary Jocelyn Alejandro, Officer, Int’l Offices & Subs Group
LEGAL AND TAX COMMITTEE Adviser Artemio V. Panganiban, Senior Adviser Margarito B. Teves, Member, Board of Advisers
Chairman Manuel Q. Bengson, Independent Director
Vice Chairman Cornelio C. Gison, Adviser
Members Jose P. de Jesus, Independent Director
Resource Person Arlene Lapus-Ureta, Head, Legal Services Department Cesar L. Lugtu, Head, Special Accounts Management Group Joshua E. Naing, Head, Controllership Group
Secretary Marilou C. Bartolome, Deputy Group Head, Controllership Group
With regard to Operational Risk Management (ORM), the Group continued alignment and coordination activities focused on ORM tools and processes to ensure consistency of implementation, as well as benchmarking of best practices.
To support Metrobank’s pursuit of its strategic growth, RSK will continue to strengthen its internal tools, processes and procedures to meet the emerging challenges of a growing organization and business where risk is inherent.
2011 Annual Report 29 04 Governance
2011 Board Attendance Names Dates of Regular and Special Meetings
Jan Feb. March April May June July Aug. Sept. Oct. Oct. Nov. Dec. 19, 23, 25, 15, 18, 22, 29, 24, 21, 26, 28, 29, 14, 2011 2011 2011 2011* 2011 2011 2011 2011 2011 2011 2011** 2011 2011
George S.K. Ty l l l l l l l l l l A l l Antonio S. Abacan, Jr. l l l l l l l l l l l l l
Francisco C. Sebastian l l l l l l l l l l l l l
Arthur Ty l l l l l l l l l l l l l
Renato C. Valencia l l l l l l l l l l A l l Valentin A. Araneta l l l l A R Remedios L. Macalincag l l l l l l l l l l l l l
Edmund A. Go l l l l l l l l l l l l l
Fabian S. Dee l l l
Jesli A. Lapus l l l l l l l l l l l l l
Amelia B. Cabal l l l l A A l R David T. Go l l l
Robin A. King l l l l l l l l l l Vicente B. Valdepeñas, Jr. l l l l l A l l l l Manuel Q. Bengson l l l l l A l Jose P. de Jesus A l l l l l A - Absent R- Resigned * - Stockholders’ Meeting ** - Special Meeting
REMUNERATION POLICY The Bank aims to provide the Board of Directors and its officers with a compensation package that is competitive with those paid by other companies, taking into account the Bank’s position against peers in the industry and other market considerations.
Generally, officers’ salaries are determined with reference to the salary scale corresponding to the position and rank. The salaries are reviewed annually and adjusted as necessary. The Bank grants fixed bonuses inclusive of 13th month pay, in compliance with law. The Bank also grants a variable performance bonus for officers based on the Bank’s performance in general, overall market conditions and individual performance of the employee.
The Board of Directors sees to it that the remuneration policy is regularly reviewed to ensure that it is commensurate with corporate and individual performance and that the remuneration is consistent with industry while maintaining internal equity at the same time.
30 Metropolitan Bank & Trust Company Report of the Audit Committee to the Board of Directors
for the year ended December 31, 2011
Responsibility The Audit Committee reports that it has performed its duties carefully and independently in compliance with its Board-approved charter and was able to carry out its work to fulfill its statutory mandate through adequate information, resources and cooperation from the Bank. The Committee assists the Board of Directors (BOD) in fulfilling its fiduciary responsibilities to enhance stakeholders’ value and protect their interest by providing effective oversight of internal and external audit functions; ensuring transparency and proper reporting; ensuring compliance with Bank policies and applicable laws, rules and regulations, and code of conduct; and ensuring that internal controls are adequate and effective. The Audit Committee assessed its performance in 2011 in order to ascertain that it has been efficient and effective and has achieved its objectives. Activities In order to receive assurance that the operations of the Bank are properly conducted, the Audit Committee obtains a good understanding of the business issues, communicates regularly with management and corroborates the information received through regular reports, meetings and past knowledge. The Committee met 13 times, and evaluated the following significant matters:
Internal and External Audits The audit plan provides a high degree of financial and operational coverage and devotes significant review of internal controls, risk management and governance surrounding the major business risks. Internal audit completed all focus areas identified and approved in the annual risk-based audit plan with adequate resources, unrestricted access, sufficient competency and overall effectiveness. An independent review of the internal audit function was commissioned and a report thereon was furnished in October 2011. The assessment was that the overall quality of Internal Audit is good, with generally a high level of compliance with the International Standards for the Professional Practice of Internal Auditing.
The Audit Committee evaluated all audit, audit-related and non-audit services provided by the external auditors to the Bank.
Internal audit provides analyses and recommendations on audit observations, including regulatory matters, which pose high risk items and remain outstanding, follows up the implementation of action plans and reports progress to senior management and Audit Committee. The Committee’s increased focus on management’s responsiveness has resulted in a marked improvement in implementation rate of audit recommendations and in the importance that units accord to the audit process.
Internal control Internal and External Auditors reported assessments of the Bank’s internal controls and overall quality of the financial reporting process with recommendations to improve internal controls and action plans to resolve the issues raised.
Various reports of the Internal Auditors and the Chief Audit Executive’s overall assessment, as well as the reports on the Annual Financial Statements and management letter of the external auditor indicate that the system of internal control, risk management and corporate governance is adequate and effective with areas for improvement and progress being made in this regard.
Risk Management The Audit Committee obtains assurance whether risk management processes are in place and effective to assess whether risks are properly identified, measured and appropriately managed and not inadequately or over controlled.
Information Technology (IT) Developments The Audit Committee receives information on developments in the Bank’s major IT projects to ensure that committed objectives are consistent with the goals of the institution and are achieved.
The Audit Committee noted that because of the size of IT expenditures and the complexity of IT operations, management is urged to prioritize delivery of projects to ensure efficient and effective client servicing, regulatory compliance and informed management decision making.
New Developments
AMLA. The Audit Committee kept abreast with recent developments in regulations through active participation in seminars and discussions on the updated anti-money laundering rules and regulations.
Whistleblower Protection. The Audit Committee noted management’s initiative to strengthen whistleblower program and was assured that the enhanced process will be made known to all employees through a detailed re-launching plan which include trainings and extensive information dissemination.
The Audit Committee continues to monitor the business environment and receives information on significant emerging risks, and verifies that Management is taking the necessary measures to address similar risk scenarios to gain assurance that there are appropriate controls in place to mitigate any possible impact.
Conclusion Based on the work undertaken and the information received (including an unqualified opinion from the external auditors on the financial statements and a representation letter from the Management of the Bank), the Audit Committee concludes that the Bank has appropriate mechanisms and policies in place to identify, manage and contain risk.
RC Valencia Chairman of the Audit Committee
2011 Annual Report 31 redefiningstandards
enduring Synergy partnershipscollaboration shared commitment perforrmance strong
32 Metropolitan Bank & Trust Company 05 Group Domestic Subsidiaries
Synergy
working together
The Metrobank Group is the Philippines ‘premier financial conglomerate with subsidiaries and affiliate companies in investment banking, consumer finance, insurance, leasing, power generation, and manufacturing.
Working together as a Group, we create products and services that serve a wide range of sectors and markets. This synergy is key to our business strategy – it allows us to strengthen our value to our stakeholders, and is at the core of our success as a financial powerhouse.
Through their combined expertise and experience, passion and productivity, innovation and insight, our subsidiaries and affiliates become the moving force behind the Metrobank Group.
2011 Annual Report 33 05 Group Domestic Subsidiaries
INVESTMENT BANKING
First Metro Investment Corporation (First Metro), The company also established its place as a premier the investment banking arm of the Metrobank Group, investment bank in the country with its participation sustained its dominance in the domestic capital markets. in raising Php83.8 billion in corporate debt issuances Its assets expanded by 23.1% to Php79.0 billion from during the year. In addition, it also raised Php33.6 billion Php64.0 billion in 2010. Capital funds reached Php11.4 from the equities market, representing a 30.0% market billion, 14.8% higher than the year-ago level. share.
Its consolidated net income grew by 28.8% to Php2.2 Its Treasury Group contributed Php1.2 billion in income billion in 2011 from the year-ago level of Php1.7 billion during the period, 34.0% higher than in 2010. Its amid volatile market conditions. Year-on-year return on Investment Banking Group made a total fee income equity stood at 20.6%. of Php275.0 million, 2.0% better than the year-ago level. Also boosting the company’s bottom line were These rosy results were the fruit of First Metro’s in- its Strategic Finance Division, which posted Php159.0 depth understanding of the domestic capital markets million in net interest income, and its Investment Advisory and extensive distribution capabilities. The company Group, which raked in Php38.0 million in trading gains successfully participated in 83.4% of the total peso- and dividends from investment in stocks. denominated domestic debt issuances in the market. It raised Php804.8 billion for the government and the corporate sector, which comprised 77.6% of the total peso-denominated issuances in 2011.
34 Metropolitan Bank & Trust Company CONSUMER FINANCE
Philippine Savings Bank (PSBank), the thrift bank arm of Metrobank Card Corporation (MCC), a joint venture of the Metrobank Group and the country’s second-largest Metrobank and Australia and New Zealand Bank (ANZ), thrift bank, was recognized as the fifth strongest bank in aims to be the leading payment solutions provider in the the Philippines and the strongest savings bank in Asia by Philippines. The Asian Banker magazine in 2011. In 2011, it posted a net profit after tax of Php1.4 billion, Its net income grew 12.2% year-on-year to a record-high a 62.9% increase compared to the previous year. This of Php2.0 billion from Php1.8 billion in 2010. The growth resulted from a 15.5% growth in customer base to was primarily driven by a 13.9% improvement in core net 963,300 and a 25.6% rise in receivables. These positive interest margin due to the expansion of its balance sheet, developments propelled MCC to the third spot in industry which more than offset the decline in spreads. Operating ranking, both in terms of card base and receivables. expenses rose by only 6.8% despite the Bank’s heavy investments in branches, ATMs and IT infrastructure. The company also registered Php27.4 billion in billings from merchants, a 59.3% increase from prior year. Its assets stood at Php120.3 billion, 15.5% higher than Php104.1 billion the previous year. Total loans grew 9.1% Even with the growth in card billings and receivables, to Php60.1 billion as its top loan products, Auto and MCC maintained its asset quality with a 4.9% past- Mortgage, increased by 13.3% and 8.7%, respectively. due rate, better than the industry average of 5.9%. This came amid the supply chain bottlenecks among It also continues to be an industry leader in portfolio Japanese carmakers and the feverish competition among management with its proactive credit and collections banks that drove down interest rates on mortgage loans. strategies. Investments in government securities also rose by 18.4% to Php31.1 billion due to the increase in the funding base MCC expanded its product lineup with the introduction of the Bank. of the new Toyota MasterCard, the country’s first complete motorist card; and the new Robinsons-Cebu PSBank’s deposits reached Php101.6 billion, 16.0% Pacific MasterCard, the only credit card that combines more than the Php87.5 billion in 2010, as it expanded its shopping and travel rewards in one. nationwide presence to 200 branches and added 125 new ATMs to increase its customer touch points.
Early in the first quarter of 2011, the Bank retired Php2.0 billion worth of Tier-2 debt papers five years ahead of maturity to take advantage of the record-low interest rates. PSBank ended the year with a capital adequacy ratio of 13.9%, well above the regulatory 10.0%. Its equity went up 33.9% to Php15.5 billion from Php11.6 billion in 2010.
2011 Annual Report 35 05 Group Domestic Subsidiaries
LEASING AND FINANCING
ORIX METRO Leasing & Finance Corporation (ORIX equity of 21.3%, as assets expanded to over Php11.2 Metro), a joint venture between Metrobank and ORIX billion in 2011. Its receivables portfolio jumped 18.7% to Corporation of Japan, provides financial leasing of Php9.0 billion compared to the 2010 level, while keeping all kinds of vehicles, industrial machineries, office the quality of its assets in check with a low past-due ratio equipment, medical equipment, and other types of of 1.5%. personal properties. Its wholly owned subsidiaries, ORIX Auto Leasing The company broke new ground in 2011 when its Philippines Corporation and ORIX Rental Corporation, consolidated resources hit a record high of Php11.2 are engaged in operating leases of vehicles and billion and its consolidated net income reached Php400 equipment. ORIX METRO plans to open more offices to million. take advantage of the growing market in the countryside. It currently has 42 branches nationwide. This enabled the ORIX METRO group to solidify its position in the leasing industry with a return on average
36 Metropolitan Bank & Trust Company INSURANCE
AXA Philippines combines the strength of two industry Philippine Charter Insurance Corporation (PhilCharter) giants: the AXA Group and Metrobank. The AXA Group continued to move up the ranks of the top ten non- is a world leader in financial protection and wealth life insurance companies in the country in terms of net management services, catering to more than 95 million premiums written. customers in 61 countries, and with over 1 billion Euros in assets under management. In 2011, the company’s net worth grew by 21.8% to Php970.9 million from Php803.6 million in 2010. It In the Philippines, AXA serves close to 300,000 reported a 46.7% increase in net income to Php150.2 customers nationwide. Its bancassurance channel is million from Php102.4 million the previous year. This composed of 500 financial executives based in 557 growth momentum placed the company in the 5th spot Metrobank branches and 1,500 exclusive agents located in the local industry. in 26 branch offices. It also has a corporate solutions team that offers group coverage. Sound underwriting principles led to a 41.6% rise in net underwriting income of Php137.9 million from Php97.4 In 2011, AXA recorded another milestone when it million during the period. Net premiums earned went generated Php2.2 billion in new business income up to Php1.2 billion from Php949.4 million, a 23.7% and total premium income of Php10 billion. These increase. Gross underwriting contribution also increased figures represented growths of 119.0% and 120.0%, to Php415.5 million, a 21.8% growth from Php341.0 respectively, from the previous year. million. Total claims paid fell to Php1.2 billion from Php1.3 billion, previously. AXA is the country’s third-largest life insurer and the dominant leader in variable life insurance or investment- In 2011, PhilCharter opened four new branches, tapping linked products with a market share of over 30.0%. the dynamic and emerging markets of Pampanga, Isabela, Batangas and Dagupan. It also launched the Metro Family Protect, which offers comprehensive accident insurance to Metrobank Card holders.
2011 Annual Report 37 05 Group Domestic Subsidiaries
MANUFACTURING
Toyota Motor Philippines Corporation (TMP) The year also saw TMP receiving several awards that strengthened its position as automotive industry leader recognized the company’s excellence in various areas in 2011 by attaining the historic milestone of 10th of its operations. It bagged the “Employer of the Year” consecutive Triple Crown. This means achieving the No. Award from the People Management Association of 1 spot in overall sales, as well as passenger cars and the Philippines (PMAP), making it the first automotive, commercial vehicles sales. as well as the first Japanese-affiliated, company in the Philippines to be given the distinction. TMP reached its 700,000 units sales milestone in September 2011 and ended the year strong with total TMP was also conferred the “Outstanding Achievement sales of 54,593 units, capturing 38.6% of the market. on Productivity and Quality” Award at the Employers Its locally manufactured vehicles, Vios and Innova, Confederation of the Philippines’ 2011 Kapatiran continued to be the country’s best-selling cars. sa Industriya (KAPATID) Awards for its successful implementation of programs in safety, productivity TMP also showed sound financial performance by and quality. TMP also garnered the Safety Milestone generating a net income of Php2.2 billion in 2011 (SMile) Recognition from the Department of Labor despite the supply bottlenecks resulting from the natural and Employment (DOLE) for achieving more than two calamities in Japan and Thailand. million safe man-hours without lost-time accident and for having complied with all reporting requirements In the luxury segment, Lexus registered a 12.0% sales for labor standards. The company was also given the growth in 2011. It also launched its first super car, the ECOSWITCH Award for successfully implementing Lexus Fuji Apex (LFA), which embodies the brand’s environment-friendly measures. relentless pursuit of perfection.
38 Metropolitan Bank & Trust Company POWER GENERATION
Global Business Power Corporation (Global Power) has As a result of these commercial operations, Global Power become one of the largest independent power providers posted a 215.0% growth in income to Php1.6 billion in in the Visayas region, with a total installed capacity of 2011 from Php522 million, previously. 633 megawatts (MW), of which 410-MW was installed after joining the Metrobank Group. In addition to CEDC and PEDC, Global Power stations also include Toledo Power Company, which owns and In the first quarter of 2011, the company marked operates a 60-MW coal plant and a 40-MW diesel plant a milestone when two of its power plants started in Toledo City, Cebu; Panay Power Corporation, which commercially operating and helping address the power owns and operates a 92-MW power facility in Iloilo City, shortage in the Visayas. These were the 246-MW power a 12.5-MW diesel plant and a 5-MW diesel plant in plant in Toledo City, Cebu operated by Cebu Energy Aklan; and GBH Power Resources Inc., which owns and Development Corporation (CEDC), and a 164-MW clean operates a 7.5-MW diesel plant in Oriental Mindoro. coal-fired power plant in Iloilo City operated by Panay Energy Development Corporation (PEDC). Both plants Global Power is the only full-service company that were set up in 2008 as part of the company’s expansion adequately provides baseload, intermediate and peak program. power, together with much-needed ancillary services to the Visayas grid. It will continue to seek various opportunities in the industry with the end in view of energizing homes and empowering development.
SMBC METRO INVESTMENT CORPORATION
2011 Annual Report 39 giving back excellence awards Corporate citizen stakeholder management change sustainability catalyst values -driven
40 Metropolitan Bank & Trust Company 06 Corporate Social Responsiblity
excellence awards
Bringing out the best in the Filipinos
To be the best is to be responsible.
As the leading financial institution in the country, Metrobank is not only accountable for its financial performance, but is also responsible for society’s well-being as a whole.
For 32 years, the Metrobank Foundation, Inc. has sustained its leadership role in the area of corporate social responsibility (CSR) through various programs on education, excellence in service, and arts, among others. To magnify the impact of these programs, the Foundation links up with various partners, beneficiaries, organizations and government agencies.
In 2011, Metrobank Foundation continued to make progress in improving social conditions and contributing to nation-building by promoting excellence in public service among teachers, soldiers, and members of the police force; in academic achievement; and in visual arts.
2011 Annual Report 41 06 Corporate Social Responsibility
Honoring Outstanding Filipinos A testament to its CSR leadership, the Metrobank Foundation has become synonymous with outstanding teachers and public servants.
On September 5, 2011, the Bank marked a milestone when it simultaneously mounted the awarding ceremonies for the Metrobank Foundation Search for Outstanding Teachers (SOT), The Outstanding Philippine Soldiers (TOPS), and the Country’s Outstanding Policemen in Service (COPS).
Now collectively referred to as the Metrobank Foundation Outstanding Filipinos, the award programs paid tribute to the exemplary public service performance of the country’s educators as agents of knowledge; and members of the police force and soldiers as protectors of the people and the state.
The Foundation plans to recognize more outstanding public servants by reaching out to local government units, civil society and grassroots organizations.
Enriching Young Minds Metrobank Foundation marked the 10th year of the Metrobank Math Challenge (MMC), one of its flagship programs on education, in April 2011.
MMC made history when it drew more than half a million participants representing 29,008 schools, 198 divisions (97% higher than in 2001 when the program started), and all 17 over500k regions of the country. The national finalists in 2011 came from 37 public schools, 15 of Math challenge participants which qualified for the national level for the first time.
42 Metropolitan Bank & Trust Company Metrobank branches nationwide were instrumental in successfully widening the program’s national footprint. The MMC actively involved branch managers in every stage of the competition, from the elimination round down to the division and regional finals.
Half of the cash prizes of the MMC winners were deposited in savings accounts via the Metrobank Fun Savers Club. This is in step with the Bank’s mission to inculcate the value of saving for the future among young students, in addition to promoting excellence in Math.
Inspiring Creativity In 2011, the Foundation also made a landmark initiative when it became the first private organization to partner with the Department of Foreign Affairs (DFA) for its Cultural Diplomacy Program. MBFI launched “DiplomART: Cultural Diplomacy through Philippine Visual Arts,” aimed at establishing, developing, and sustaining foreign relations through culture, the arts, and education.
To highlight the undertaking, art lectures were conducted and attended by DFA officers, cultural attaches, and future ambassadors who represent the Philippines in their respective foreign posts. An exhibit of winning artworks from 27 years of Metrobank Art & Design Excellence (MADE) competitions was also mounted.
Empowering CommunitieS In addition to the programs of MBFI, Metrobank also engages its own employees for various CSR initiatives. This is done through the Metrobank Purple Hearts Club (PHC), which is managed by the Bank’s Employee Relations Division under its Human Resources Management Group.
To complement the Bank’s leadership in the industry, PHC also reaped one of the highest honors bestowed upon corporate volunteer organizations in the country. In May 2011, the state-run Philippine National Volunteer Service Coordinating Agency (PNVSCA) gave the 2010 National Outstanding Volunteer Award to the Metrobank Purple Hearts Club for its exemplary employee volunteerism programs, and Metrobank’s commitment to public service and human development.
The Club has 46 nationwide chapters and a total of 4,878 members, representing nearly half of the Bank’s workforce in 2011. Among its initiatives in 2011 were raising funds for the Teachers Month Campaign; providing computers, software and printers to 40 elementary public school teachers of San Roque Elementary School in Marikina City; mounting a nationwide PHC Volunteers Day; and the annual Nationwide Dugong Metrobank, a bloodletting activity; Meme na Bunso, a touch therapy program integrated in basic child care; Kwentong Bata beyond storytelling program, Byaheng ABKD, a tutorial and library enrichment program.
2011 Annual Report 43 06 Corporate Social Responsibility
The Metrobank PHC also launched four corporate-community partnerships in 2011 to replicate its partnership with Ligaya-Escopa III Gawad Kalinga Village in Quezon City. PHC volunteers conducted weekly tutorial, storytelling and library enrichment sessions that benefited 134 children from five communities.
Delivering Quality Healthcare As the healthcare arm of the Metrobank Foundation, the Manila Doctors Hospital (MDH) has over k served over 33,000 patients through its Corporate Social Responsibility hospital services, 33 medical missions, community health, and school health programs. patients served
In addition to acquiring the latest modern diagnostic services equipment, MDH, through a partnership with the Department of Health (DOH), held the 3rd Doña V. Tytana Memorial Lecture in June 2011, with Health Secretary Enrique Ona as guest lecturer.
MDH also received several awards in 2011, most notably a Gold, two Silver and a Bronze in the 2011 Search for the Most Outstanding Quality Improvements Study in the Hospital Awards by the Philippine Society for Quality in Health Care (PSQua).
MDH also won the Excellence Award at the 2011 Asian Hospital Management Association (AHMA) Awards for its comprehensive community healthcare program in Barangay 737 in San Andres, Manila. This was the fourth consecutive year it has received an AHMA recognition for its outstanding projects since 2008. It was also among 35 finalists from 84 hospitals in 11 countries worldwide.
The Hospital’s commitment to quality healthcare was affirmed by PhilHealth which accorded a “Center of Excellence” rating to MDH. This was the highest accreditation rating given by the government health insurance agency.
Giving Back Metrobank also mobilized its employees and those from its member companies to jointly carry out other CSR programs in 2011. These were the following:
For the first time, Metrobank celebrated “CSR Week” with a nationwide tree-planting activity involving employees of the entire Metrobank Group. Dubbed as “You’re in Green Hands,” the activity gathered 1,854 volunteers from Metrobank and its member-companies. A total of 17,490 tree seedlings were planted in nine sites nationwide. Metrobank Foundation partnered with the Department of Environment and Natural Resources (DENR), local government units, the Philippine National Police, and clients of the Bank.
The Metrobank Group celebrated the Chinese New Year with the distribution of Php10 million worth of food packages to 10,000 less fortunate families in key cities and provinces nationwide. Called “Bags of Blessing,” the gift-giving activity involved a total of 1,045 17,490 employee volunteers in the preparation and actual distribution of food packs. seedlings planted
44 Metropolitan Bank & Trust Company The Bags of Blessing gave us the opportunity to celebrate the Chinese New Year to share the fruits of our successes in the industry to our underprivileged Filipino brothers and sisters. Aniceto Sobrepeña Metrobank Foundation President
In addition to the Metrobank Purple Hearts Club (PHC) and the Manila Doctors Hospital (MDH) Purple Hearts Club, employee volunteers also came from Metrobank subsidiaries –– Federal Land Inc., PSBank, First Metro Investment Corporation, GT Metro Foundation, Global Business Power, and Toyota Motor Philippines, with Metrobank Foundation as lead convenor.
Among the beneficiaries were victims of recent calamities in the Bicol region, Eastern Visayas, and select provinces in Mindanao. The Foundation also coordinated with several government agencies and LGUs of the 19 distribution areas.
In 2012, the Bank, through Metrobank Foundation, will continue to focus on increasing convergence among its CSR programs with the battlecry, “Converging to Inspire Change.” This will demonstrate the Foundation’s unified efforts towards nation-building.
It will continuously engage more stakeholders, particularly those in the public sector, to cultivate a culture of excellence among Filipinos, champion social good, and make a P m difference in the lives of those touched by the Bank’s leadership and presence. 10 for 10,000 families
2011 Annual Report 45 07 Board of Directors
Dr. Antonio S. Abacan, Jr. Francisco C. Sebastian Dr. George S.K. Ty Chairman, Board of Directors Vice Chairman, Board of Directors Group Chairman Vice Chairman, Metrobank Group of Companies Chairman, First Metro Investment Corporation Founder, Metrobank Chairman, Toyota Financial Services (Phils), Inc. Chairman, Federal Land, Inc. Chairman, Toyota Motor Philippines Corporation Chairman, Sumisho Motor Finance Corporation Chairman, Global Business Power Corporation Chairman, Metrobank Foundation, Inc. Chairman, Manila Medical Services Inc. Chairman, First Metro Asset Management, Inc.
Arthur Ty Jesli A. Lapus Director/President Independent Director Remedios L. Macalincag Vice Chairman, Philippine Savings Bank Chairman, Manila Tytana Colleges Independent Director Vice Chairman, Metrobank Foundation Inc. Former Secretary, Department of Trade and Industry Chairman/President, Premium Equities, Inc. Chairman, Metropolitan Bank (China) Ltd. Former Secretary, Department of Education Former President/CEO, Development Bank of the Philippines Director, Global Business Power Corporation Former President/CEO, Land Bank of the Philippines Former Chairman, LGU Guarantee Corporation
Renato C. Valencia Independent Director President/CEO, Roxas Holdings, Inc. Vice Chairman, Asia Pacific Network Holdings, Inc. Chairman, Hypercash Payment Systems Inc. Former President/CEO, Social Security System Former Chairman/CEO, Union Bank of the Philippines
46 Metropolitan Bank & Trust Company Jose P. De Jesus Dr. Vicente B. Valdepeñas, Jr. Independent Director Independent Director Edmund A. Go President, NADECOR Consultant, Bangko Sentral ng Pilipinas Director Former Secretary, Dept. of Transportation and Communications (DOTC) Member Advisory Panel to the ASEAN +3 Director, Metropolitan Bank (China), Ltd. Former President/COO, Manila Electric Company Former Member, Monetary Board Adviser, Philippine Savings Bank Former President and CEO, Manila North Tollways Corporation Former Minister, Economic Planning and Director General of NEDA Director for Investment, Ateneo de Manila University
Manuel Q. Bengson Independent Director Independent Director, Board of Governance, PDS Robin King Independent Director, Energy OPT Independent Director Alfred V. Ty Former Senior Managing Director/Treasurer, Ayala Corporation Former Independent Director, FMIC Corporate Secretary Former EVP/Treasurer, Bank of the Philippine Islands Former Independent Director, Toyota Financial Services Phils. Inc. President, Federal Land, Inc. Former President, BPI Capital Corporation, BPI Int’l Finance, Former, President & CEO, Global Bank Phils. Vice Chairman, Toyota Motor Philippines Corporation BPI Family Savings Bank, Ayala Life Assurance and FGU Insurance Former President and CEO, International Bank of California Independent Director, PLDT
Mariquita L. Agena Assistant Corporate Secretary Head, ALM Division, Metrobank Treasury Group Corporate Secretary, Toyota Manila Bay Corporation 2011 President, Money Market Association of he Philippines
2011 Annual Report 47 08 Board of Advisers
Washington Sycip Artemio V. Panganiban Fidel V. Ramos David K. P. Li Chairman, Board of Senior Advisers Senior Adviser Senior Adviser Senior Adviser Founder, SGV & Co. Former President, Republic of the Philippines Former Chief Justice, Supreme Court of the Philippines Chairman/CEO, Bank of East Asia, Ltd. Hong Kong Chairman Emeritus, Asian Institute of Management
Domingo L. Siazon, Jr. Placido L. Mapa Jr. Senior Adviser Senior Adviser James Go Former Secretary, Dept. of Foreign Affairs Chairman, Board of Advisers Charles Cheung Former Director General of the United Nations Industrial Vice Chairman, Metrobank Foundation, Inc. Senior Adviser Senior Adviser Development Organization (UNIDO) Chairman, University of Asia & the Pacific Council Member, Hong Kong Institute of Directors Chairman, Toyota Cubao Inc. Former Ambassador to Japan Chairman, SMBC Metro Investment Corporation Director, Metropolitan Bank (China) Ltd. Chairman, Toyota Manila Bay Corporation
Pascual M. Garcia III Margarito B. Teves Board Adviser Tan Tian Siong Board Adviser Gabriel Chua Director/President, Philippine Savings Bank Chairman, Think Tank Inc. Vice Chairman, Board of Advisers Director, Toyota Financial Services (Phils) Inc. Former Secretary, Department of Finance Vice Chairman, Board of Advisers Chairman/President, Nation Paper Products & Director, Sumisho Motor Finance Corporation Former President, Land Bank of the Philippines President, Solid State Multi Products Corporation Printing Corporation Trustee, Chamber of Thrift Banks
Fabian S. Dee Roberto Juanchito T. Dispo David O. Chua Board Adviser Board Adviser Board Adviser Chairman, Metro Remittance Singapore Pte. Ltd. President, First Metro Investment Corporation Director, Philippine Stock Exchange Chairman, Metrobank Card Corporation Chairman, First Metro Securities Brokerage Corporation Trustee, University of the East Cornelio C. Gison Adviser, Metropolitan Bank (Bahamas) Limited Vice Chairman, First Metro Asset Management Inc. Vice President, Federation of Filipino Chinese Chamber Board Adviser Director, FMIC Equities, Inc. (FEI) Director, Travel Services Inc. of Commerce and Industry, Inc. Former Undersecretary, Department of Finance
Henry M. Sun Board Adviser Former President, Philippine Charter Insurance Corporation
48 Metropolitan Bank & Trust Company 09 Principal Officers
Seated (left to right): Senior Executive Vice President Fabian S. Dee, Executive Vice President Aniceto M. Sobrepeña Standing (left to right): Executive Vice Presidents - Fernand Antonio A. Tansingco, Helen U. Fargas, Vivian L. Tiu, Joshua E. Naing
Seated (left to right): Executive Vice Presidents - Bernardito M. Lapuz, Josefina E. Sulit Standing (left to right): Executive Vice Presidents - Dennis G. Suico, Vicente R. Cuna, Jr., Benedicto C. Legaspi, Jr.
2011 Annual Report 49 09 Principal Officers
Senior Vice Presidents
Seated (L-R): Rowena D. Oliveros Mariquita L. Agena Amelin S. Yao Adrian Francisco A. Villanueva Luz I. Blanco Christine W. Yang
Standing (L-R): Bernardo H. Tocmo Eligio C. Labog, Jr. Mary W. Sy Jose Raymund O. Vergara Nonato P. Arboleda Richard Benedict S. So
50 Metropolitan Bank & Trust Company Seated (L-R): Josefina T. Tuplano Marilou C. Bartolome Maritess B. Antonio Jose M. Chan, Jr. Corazon Ma. Therese B. Nepomuceno
Standing (L-R): Stephen S. See Reynaldo H. Liao Angelica S. Reyes Cesar L. Lugtu Dennis C. Qua Fermin T. Chio Domingo V. Guanio Rosendo G. Sia Arlene L. Ureta
2011 Annual Report 51 10 Senior Officers
First Vice President De Vera, Rosanna F. Assistant Vice President Lim, Walter C. Abellar, Ma. Lourdes P. Dy, Teresita L. Abueg, Alona A. Limpin, Irmino Noel R. Amora, Imelda Marie A. Dy Buncio, Anjanette T. Ajos, Jay Nazarene Christene A. Liwanag, Fina Victoria S. Arnaldo, Alex F. Esguerra, Samuel C. Alberto, Albert I. Loquellano, Gildardo C. Capulong, Jovencio R. Evangelista, Ferlou I. Alburo, Rosauro A. Lu, Dennis Lawrence T. Carandang, Francisco R. Fausto, Edgardo M. Amahan, Alfredo F. Mangonon, Flordeliza E. Cruz, Godofredo V. Felipe, Herman Rufino S. Antonio, Rodolfo E. Manzano, Ma. Imelda L. Dayrit, Nurjehan Maria D. Francisco, Rene L. Aquino II, Cecilio A. Maraña, Alfonso S. De Santos, Justina Ma. Teresita M. Gamboa, Marie Edgette Simonette C. Arellano, Hector B. Maraingan, Rey T. Dela Peña, Pocholo V. Gianan, Antonio T. Arellano, Marian B. Mayor, Ma. Ana S. Dionisio, Rommel Enrico C. Gonzales, Maricar Rosario C. Asuncion, Alvin F. Medalla, Maria Nelia S. Dy, Mary Beck C. Goyenechea, Lelany O. Baculi, Antonio T. Millonado, Maida Lourdes E. Esguerra, Edgar G. Gregorio, Enrique M. Bautista, Dionnette P. Ochoa, Marie Antoinette M. Espina, Luis S. Guerrero, Oscar Manuel Jr. C. Bauto, Ramoncito O. Ong, Nerisa Y. Fajardo, Ma. Theresa A. Guevarra, Leonides V. Berbaño, Noel L. Ongsiaco, Edna O. Fernandez, Josephine F. Guiao, Melizza Doris L. Bernabe, Laarni D. Oppus, Maja G. Gamboa, Fatima P. Guinto, Elizabeth B. Bonagua, Lito D. Paatan, Yagtan Kenin S. Go, Emmeline D. Gumban, Milagros L. Bormate, Rebecca B. Padilla, John L. Go, Domingo C. Kaamino, Esmeralda Carilyn P. Burgos, Reynaldo C. Raymundo, Lilibeth S. Guerrero, Edgar Alan P. Kwan, Flordeliz T. Cabral, Emmanuel R. Rosales, Florian C. Jandayan, Vicente F. Lecaros, Arnold A. Calumpang, Eric A. Rosette, Edita E. Lim, Alex C. Leung, Ramir M. Capacillo, Joyce L. Roxas, Cynia C. Lim, Irene L. Lim, Mary Joyce S. Capili, Remigio R. Salazar, Robert Manuel B. Marfa, Maximiano Jr. D. Lindo, Ely Roy B. Cariaga, Bernardine V. Salcedo, Rosana R. Medrano, Quintin Jr. T. Lugue, Manolo T. Cayanan, Gabriel N. Salvador, Raquel V. Oxales, Maria Lourdes Veronica C. Magdame, Peter Louie D. G. Chan, Marie Chorie Candice R. Samaniego, Chad Aaron R. Pagaspas, Angel O. Manalad, Editha R. Chiong, Easter Angela S. Samonte, Angela Esperanza M. Reyes, Rose Mary T. Mariano, Federico T. Chiu, Mary Ann K. Sanagustin, Jose Luis S. Rivera, Maritess D. Matriano, Romulo Jr. M. Chua, Claudine U. Santos, Ma. Milagros L. Salgado, Mark Anthony H. Mercado, Rizaldo G. Chua, Antonietta O. Santos, Ruben L. Tan, Irene Y. Mirasol, Esmeraldo S. Cocabo, Jinnah E. Santos, Veronica C. Tan, Lita S. Navarra, Jasmine E. Cochico, Anne Marie D. Say, Spencer C. Tiu, Lucia C. Niere, Susan L. Cordero, Eufrocina C. See, Nelson G. Ubaldo, Leopoldo M. Osorio, Manolito M. David, Jaqueline L. Seludo, Mary Grace J. Villegas, Joan Marie A. Palao, Katherine G. De Guzman, Eric P. Sevidal, Raquel N. Yao, Marilyn M. Pangilinan, Avmir D. De La Paz, Ma. Cecilia V. Siao, Abelardo E. Yap, Josephine Kee Hong S. Pineda, Jose Antonio C. Delizo, Ricardo S. Siriban, Cynthia P. Yu, Allan S. Reyes, Maria Sharon C. Diño, Carissa A. Tan, Jennifer G. Rivera, Elmer R. Diokno, Pollyanna B. Tan, Leny C. Ruiz, Cynthia G. Dionisio, Isabelo M. Tan, Maria Gina R. Vice President Salazar, Ma. Rosario L. Fausto, Marissa C. Tan, Mary Janet S. Abes, Kathryn Francis B. Tan, Helen L. Fernandez, Ma. Carlota C. Tan, Roseanne T. Aguila, Elizabeth B. Tanglao, Elmer R. Florendo, Eugenia A. Tee, Elsa U. Alcantara, Allen D. Tiongson, Carmelita A. Flores, Loreta U. Tenorio, Florencio A. Alincastre, Celso Manuel Jr. G. Tobias, Benigno G. Fragante, Leo R. Tiu, Betty T. Almeda, Mary Jacqueline Justina H. Tobias, Juan Antonio T. Francisco, Criselda N. Trinidad, Maria Elena Z. Amparado, Amelia S. Tolentino, Lorna Y. Gabriel, Eloisa A. Tuason, Tomas Antonio D. Antonio, Marvin Eugene N. Tolentino, Ma. Teresa V. Gan, Grace P. Urbiztondo, Rey C. Arjonillo, Carolina K. Ty, Zandra M. Gan, Rosita C. Valenzuela, Ma. Gingili A. Barrera, Emmanuel C. Victoriano, Randell D. Gerona, Carmencita L. Vargas, Merlito M. Bellon, Elaida A. Villanueva, Enrico P. Go, Andrew Michael G. Villanos, Immaculada E. Bondad, Elizabeth D. Villanueva, Ricardo F. Gonzales, Antonio Soliman Jr. A. Yap, Sydney Thaddeus K. Buenavista, Grace C. Vinluan, Julito R. Hernandez, Raymond C. Centena, Mia S. Wong, Jay S. Jose, Jocelyn C. Cervero, Josephine G. Xu, May Sherri M. Koa, Alicia K. Chang, Valentino C. Yap, Natalie N. Lao, Carolyn T. De Guzman, Crisostomo P. Yuseco, Noel Peter Z. Leonardo, Carilla S. De Jesus, Marie Joan Socorro J. Zoluaga, Olivia Visminda G. Liao, Ma. Theresa E.
52 Metropolitan Bank & Trust Company Shareholder Information www.metrobank.com.ph
Stock Transfer Agent Metrobank is the country’s premier universal bank, with an Metrobank Trust Banking Group extensive consolidated network that spans over 1,581 ATMs 17th Floor GT Tower International nationwide, 785 local branches, and 39 foreign branches, 6813 Ayala Avenue corner H.V. de la Costa St. subsidiaries and representative offices. Makati City, Philippines 1200 Tel: +632 857 5600 Fax: +632 858 8010 EASTERN – 63555 METMKT PN (TELEX) FAX +632 817 6248 Customer Care: 8700 700 Investor Relations Domestic Toll-Free: 1 800 1888 5775 11th Floor Metrobank Plaza Member of the Philippines Deposit Insurance Corporation Sen. Gil Puyat Avenue A proud member of BancNet Makati City, Philippines 1200 Tel: +632 857 9783 Fax: +632 817 6355 Email: [email protected]
CORPORATE COMMUNICATIONS 11th Floor Metrobank Plaza Sen. Gil Puyat Avenue Makati City, Philippines 1200 Tel: +632 857 5526 Fax: +632 893 3726 Email: [email protected]
2011 Annual Report 53 Head Office Metrobank Plaza Sen. Gil Puyat Avenue Makati City, Philippines 1200
54 Metropolitan Bank & Trust Company