2018 ANNUAL REPORT THE FUTURE MADE POSSIBLE BUILDING A SUCCESS-DRIVEN FUTURE Having the drive and dedication to exceed goals and expectations. BANKING WITH INTEGRITY Adhering to strong moral principles in all circumstances. TRANSFORMING THE WORK PLACE Teamwork, working together effectively, combining our individual strengths, toward common goals. ADVOCATING SUSTAINABILITY Caring for our stakeholders’ social, economic and environmental development. Metrobank’s code of conduct is anchored upon 5 core values: Passion for Results, Integrity, Teamwork, Commitment to Customer Service, and Heart for Community. In the words of our President “These 5 core values that form the acronym PITCH are what define us as Metrobankers.” VISION MISSION* Probably the best expression of PITCH is the I Am A Metrobanker Pledge. At the start of each working day, Metrobankers recite this commitment with remarkable “It To be the country’s premiere financial zeal for these are not merely words for us. As how our President succinctly puts it, is not enough that we know and understand what PITCH is. It is only thru living these values conglomerate, empowering our individual every day that we become worthy of the trust given to us, the good hands of Metrobank.” and business clients to realize their goals and reach their full potential. By creating and customizing financial solutions in response As you go through the pages of this report, you will bear witness to the 2018 to our stakeholders’ needs, continuously Metrobank story, and at the same time you will see how we utilized our values as a expanding our scope of reach, and leading in tool in intricately crafting this narrative. community service, we live up to our “You’re in Good Hands” promise that embodies who I AM PASSIONATE FOR RESULTS. I act everyday to exceed we are and what we do. We are Metrobank. expectations and make meaningful impact. *The Vision Mission Statement (VMS) 2018 is a year full of firsts for the bank, given the numerous deals and awards we was approved by the Board in December 2016 had, and most notably, our outstanding year-ender performance. These feats are acknowledged in the Chairman’s Message & President’s Report. I AM A PERSON OF INTEGRITY. I always choose to do the WE COMMIT TO BE right thing and I act when I see wrongdoing. THE TRUSTED FINANCIAL PARTNER Our business relies on the principles of The Corporate Governance section proves that everything we do is within the bounds trust, honesty and integrity as we serve of integrity, accountability, and transparency. our customers and help them attain their financial goals. I AM A CHAMPION OF TEAMWORK. I encourage and help my fellow Metrobankers, we create an inspiring place to work THE EMPLOYER OF CHOICE together. We strengthen the organization by continuously developing and enhancing the Through our employee engagement activities and training initiatives, we develop and abilities of our people. nurture the welfare of our people and at the same time, strengthen our organization. We nurture them into professional individuals I AM COMMITTED TO CUSTOMER SERVICE. I truly care for with integrity and passion for service and excellence. We ensure their future by the people we serve and keep them at the heart of all we do. providing them with fulfilling careers. In this report, we will be featuring Metrobank products and services that echo RESPONSIBLE BANK our commitment to being the best service provider to you, our customers. These We adhere to the highest standards symbolize our partnership in growing your business and in fulfilling your big dreams. of corporate governance, exercising accountability, fairness, and transparency I AM AN ADVOCATE OF HEART FOR COMMUNITY. I believe across all our business operations. that it is not enough to make a living, I need to help make lives better. We exercise good management to provide our shareholders with sustainable returns on For the past years, we have been consistent in fulfilling our corporate social their investments. responsibility through the Metrobank Foundation. AN INSTITUTION WITH A HEART “In the last 56 years, there has been no shortage of stories of good hands doing great We give back to the communities we deeds.” We proudly share with you these milestones and successes. All these would serve, committed to making meaningful not be possible without your trust and confidence in our institution. This 2018 contributions to the economic and social Annual Report is the compilation of our proud moments and multiple firsts with you development of our nation. which prove that we have indeed made your future possible by staying grounded on our values. This is who we are. And this is how we live up to the promise of being the good hands of Metrobank. 1 CHAIRMAN’S REPORT THE FUTURE MADE POSSIBLE analytics can lead to efficiency; improve cross selling, targeted marketing, and dynamic decision-making. WE MAKE In this digital society, customer behavior constantly evolves including expectations for seamless Omni channel experience. Financial disruptors will remain a threat. The THE added complication is to make digital experience safe and transparent, while treating customer information with utmost privacy. By embracing this new world order, we keep FUTURE our hopes to stay in the game and remain relevant to our customers. These are some of our considerations as we create and reshape our digitalization strategy. OUR CORE VALUES SERVE POSSIBLE Let me now take this AS AN ANCHOR ON WHAT’S opportunity to thank all our Dear fellow shareholders, evolving customer needs and To make the future possible employees for your hard advancements in technology today, the journey starts with IMPORTANT IN KEEPING work and contributions in 2018 was a year characterized that will impact us and our our people. To continuously the past year. I am proud by many uncertainties, from customers like never before. reinvigorate their spirit, we OUR CUSTOMERS HAPPY of all Metrobankers who geopolitical events, financial Likewise, investors worry about launched an internal campaign worked together effectively by stress in the developed and the impact of rising rates to highlighting the importance of AND OUR EMPLOYEES combining individual strengths emerging economies, and the economy, which in turn our core values: Passion for to reach common goals. The market volatilities. In the past will affect lending activities, and results, Integrity, Teamwork, ENGAGED, TO ENSURE drive and passion to achieve two decades, quantitative easing draw the spotlight on asset Commitment to customer targets without compromising and lower interest rates around quality. service, and Heart for the THE SUSTAINABILITY OF integrity and quality is a the globe allowed economies community or PITCH as we hallmark of this institution. OUR BUSINESS , AND TO to grow aggressively, which in Despite all that, we also simply call it. turn allowed our business to recognize that 2019 presents To our Board of Directors, CONTRIBUTE TO NATION- thrive. But in 2018, the world a lot of growth opportunities. These principles, applied in thank you for your guidance and economy turned the corner, We can expect positive everyday activities, serve as an insights, and to the management BUILDING. with most countries moving to stimulus from robust consumer anchor on what’s important in team, for your unceasing a tighter monetary policy and spending, stronger government keeping our customers happy dedication. - Arthur Ty raising interest rates. Seismic expenditures on infrastructure and our employees engaged, to shifts that paved the way for the projects, and steady private ensure the sustainability of our Finally, my sincerest gratitude new normal. sector investments to expand business, and to contribute to to our loyal customers, and invest for the long-term. nation-building. The effects can partners, and investors – your Even then, the Philippine be wide-ranging and compelling. economy grew by 6.2 %, still unwavering support inspires us The Metrobank Group to strive and make the future among the fastest-growing in We also recognize the need possible today. Asia. Against this backdrop, continues to hold a to drive business through Metrobank stayed resilient, digital innovation. The pace of reporting strong earnings leading position in this digital change is so rapid that growth for the year driven growing economy. banks have come to realize mainly by our core business. So how do we move forward how investments in digital and take advantage of this technologies can be a key Looking ahead, we can expect differentiator for customer potential? ARTHUR TY a continuation of these experience. In addition, over Chairman unexpected risks and volatilities, time the use of data-driven 3 PRESIDENT’S REPORT THE FUTURE MADE POSSIBLE TURNING AS WE GEAR UP FOR VISION INTO THE FUTURE, WE REMAIN COMMITTED TO GOOD GOVERNANCE, REALITY TRANSPARENCY, AND The Philippines continued on October, the highest in over For 2018, Metrobank’s loan DELIVERING SUSTAINABLE its growth momentum in a year 10 years, prompting the BSP portfolio grew at a modest marked by many challenges. to raise policy rates five times pace of 10%, while deposits RETURNS TO OUR The Philippine economy grew by 175 basis points to arrest inched up 2% year-on-year. 6.2% in 2018 on the back of second-round effects. Low-cost deposits continued SHAREHOLDERS. resilient consumer spending, to comprise the majority solid government spending, Against this backdrop, the of the deposit base at 62%. and robust investment growth, Philippine banking industry Combined with margin - Fabian S. Dee making the country still one of continued to thrive, as demand expansion, this led to a 12% Southeast Asia’s fastest growing for loans expanded double-digit growth in net interest income economies. while deposits likewise grew, to P68.8 billion, which now albeit at a slower pace. accounts for 74% of the bank’s Across the globe, significant total revenues.