Reports & Publications

Financial Highlights


   The only way NRBSL can achieve the desired financial performance given its risk exposures is to practice sound financial management thereby building capacity for growth through higher volume of credit portfolio while maintaining quality. Using various parameters and ratio indicators, NRBSL’s 2018 performance is record-breaking in the areas of profitability and credit portfolio while augmentation in deposit and capital levels is being sustained.

New Rural Bank of San Leonardo (Nueva Ecija), Inc.
Financial Summary / Financial Highlights
As of 31 December 2018 and 31 December 2017


   NRBSL’s 2018 income performance of P27M net of taxes beat the previous year’s P24.8M as the Bank’s new record all-time high profitability. Noticeable contribution is the surge in non-interest income which soared to P65M from only P38M in 2017. Gains from asset disposal, fee-based income and charges from sustained loan collection efforts contributed significantly in this substantial increase in profits. These additional revenues allowed the Bank to absorb bigger compensation and personnel benefits which is mainly behind the increase of P17M in non-interest expenses along with depreciation and other cost items. This increase was expected as additional employees were hired for the opening of new branches and adjustments in wages of existing personnel in line with the new salary grading scheme. Likewise, depreciation of bank premises i.e. building and leasehold improvements increased accordingly as new branch sites were set-up. With the increase in credit portfolio in 2018, NRBSL booked P16.5M in additional allowance for probable losses in accordance with its Loan Loss Estimation Methodology. The additional booking in 2018 is higher compared P15.7M in 2017 yet, the Bank’s net income is more than P2M higher compared to year-ago level.

   NRBSL achieved another milestone in 2018 as its total equity surpassed the P200M level reaching P218.6M at the end of the year. This increase of around P26M matched the previous record of P26M from 2016 to 2017 for a combined P52M accumulated capital in a short span of two years. With bigger cumulative capital in 2018 as reference, the Bank’s Return-On-Equity (ROE) understandably dropped to 11.19% from 13.81%. Nonetheless, its Return-on-Assets (ROA) improved from 2.11% to 2.48%. These ratios indicate that NRBSL is a viable investment thus the confidence level is high to welcome new partners into the equity structure of the Bank.

   The expansion of NRBSL’s credit portfolio and increases in deposit level are mutually reinforcing developments in the Bank for 2018. The advocacy to lend to more small farmers for their food crop production and livestock raising projects resulted to bigger credit exposures to agriculture. This expansion of the Bank’s agricultural credit portfolio in 2018 was mainly funded by increased deposit levels from the depositing public in general and notably from placements of other banks for their alternative compliance on Agri-Agra Law. The increasing number of special deposit account holders under Republic Act 10000 was complemented by more funding from DA-ACPC for its Production Loan Easy Access (PLEA). This combination of fund sources helped NRBSL diversified its funding structure and led to more budget allocations in favor of the agriculture industry. These developments reflect the growing confidence on NRBSL of its various stakeholders which now include fellow banks and more government agencies. But even with new sources of funds, NRBSL maintains its good standing with its long-time creditors. NRBSL’s credit facilities with Land Bank of the Philippines (LBP), Small Business Corporation (SB Corp), Development Bank of the Philippines (DBP) and Bangko Sentral ng Pilipinas (BSP) are all active and readily available.

   On a year-to-year comparison, NRBSL’s Capital Adequacy Ratio (CAR) improved to 17.46% as of December 2018 cut-off. This improvement in CAR from 17.33% in 2017 though small is considered a demonstration of how NRBSL’s ability to avoid deterioration in capital adequacy as expansion of its loan portfolio pushed the level of risk assets to rise. This scenario is attributable to increase in the Bank’s networth resulting from high profitability during this period. The improved profitability situation allowed NRBSL to declare P8M in cash dividends in 2018 yet CAR level remains stable. Capital adequacy is a major concern for NRBSL and it is on guard if booking of more loans is disproportionate to the level of its capital. At the current level of its risk-weighted assets, NRBSL’s capital of P218M results to a CAR of 17.46%. By industry average, this ratio is at par and it is almost 8 percentage points higher than the required minimum. But taken from another perspective, NRBSL’s location in the industry as number 27 nationwide is held back by its 44th ranking in capitalization.

   As part of its liquidity management strategy, NRBSL is maintaining its stable core deposit base. This is done by keeping the pool of depositors broad and encouraging small savers to place their money with NRBSL. The special license granted by BSP in favor of NRBSL to undertake solicitation of deposits outside bank premises helps the Bank to reach-out to depositors in their residences and business sites. Targeting these small savers using the basic deposit account product is another activity of the Bank in heeding government’s call to promote financial inclusion.

   With this profile of its depositors, the Bank’s observes a safe, simple and low-risk fund management practices. The Bank is able to determine an appropriate liquidity level which eases the pressure in maintaining unnecessarily high cash position. This explains why NRBSL opted to maintain a lower level of liquid assets of P255M in 2018 compared to P289M in the previous year. The reduction saves the Bank from incurring more interest expense thus allowing allocation for compensation and other personnel benefits. Budget for depreciation expenses and others related for the setting-up of new branches is allocated accordingly.

   As its main engine for growth, the vigorous booking of loans and substantial additional deposits raised the level of the Bank’s total resources to P1.525 billion, posting a net increment of P207M from P1.318 billion in 2017. The increase in 2018 may not be as big compared to 2017 when the level of total resources surged by P282M which is the biggest ever. Nonetheless, the performance in 2018 is still significant as combined with that of 2017 the accumulated asset growth in the last two years reached almost P500M. With this accomplishment, NRBSL’s total resources grew by a phenomenal rate of around 50% from P1billion mark just two years earlier in 2016.