Rizal Commercial Banking : RCBC 2022 Annual Report

OUR BUSINESS

BUSINESS REVIEW

SUSTAINABILITY

I

MPACTS

3

12

26

CORPORATE

GOVERNANCE

28

85

2

Our Business at a Glance

130

Senior Management

4

Message from the Chairperson

138

Heads of Subsidiaries

6

President's Report

144

Senior Officers

10

Financial Highlights

152

RCBC Subsidiaries Senior Officers

12

Business Review

156

Branch Directory

26

Sustainability Impacts at a Glance

169

Rizal Microbank Branch Directory

28

Risk Management

170

Subsidiaries and Associates

85

Corporate Governance

171

Products and Services

118

Board of Directors and Advisory Board

188

Audited Financial Statements

VISION

MISSION

To be the most admired and trusted profitable financial

We are a leading universal bank, providing quality Integrated

services group providing and adapting to customers'

Financial Services that best meet our clients' needs. We are

changing needs - for every Filipino worldwide -

committed to conducting our business with utmost integrity,

through innovative products, excellent service and a

excellence, and commitment as responsible corporate citizens;

highly motivated, committed and impassioned team.

and providing professional growth opportunities to develop a

talented base of officers and employees, and achieving the best

returns for our stockholders.

It was a year that further propelled us forward. Thanks

to the reopening of the economy, the expected Php27-

billion equity infusion from Sumitomo Mitsubishi Banking

Corp. (SMBC), and all our hard work, RCBC is now the

Managing the unpredictable is possible

country's fifth largest privately owned bank and among

only when we move together as one - as

the most recognized for leading the charge on digital

people with diverse skills but driven with

banking innovations, retail banking, human resources,

and sustainable finance, among others.

a singular purpose to tackle complex

To make a mark in these very volatile and uncertain times

problems and offer simple solutions to

our customers.

is truly a feat worth celebrating.

The challenging landscape

In 2022, we thought we could finally emerge from the

long tunnel that was the COVID-19 pandemic and see the

That we have done all these while still promoting good

light. But then the war between Russia and Ukraine, rising

corporate governance practices and serving the interests

inflation and interest rates, an energy crisis in Europe,

of all our stakeholders is indeed worthy of the four-

global supply chain disruption, China's lockdown due to

arrow recognition we earned at the ASEAN Corporate

its zero-COVID policy, and the urgency to address climate

Governance Scorecard (ACGS) Golden Arrow Awards in

change have started to cloud our horizon again.

2022. The Institute of Corporate Directors (ICD) named

RCBC as among the publicly listed companies in the

Fortunately, the Philippine economy was resilient enough

Philippines that have shown an outstanding performance

to withstand these external shocks. Our GDP grew by

in

ensuring transparency and

accountability and

7.6%, the best in 46 years and the highest in the ASEAN

"upholding shareholders' rights, among others.

region, buoyed by strong household consumption and

investments. However, the Bangko Sentral ng Pilipinas

We take pride in earning this recognition as it clearly

(BSP) had to raise its policy rates by a total of 400 basis

demonstrates the values that we hold dear at RCBC.

points since May 2022 to stave off inflationary pressures,

Trust that we will continue laying the groundwork for

consistent with the U.S. Federal Reserve's move to raise

our

future success by reinforcing

our already strong

its benchmark interest rate to the highest level in 15 years

governance and compliance culture.

''

and that of many central banks around the world.

Leading as one RCBC

Despite the world's challenges, we look to the future with

hope and confidence because we have seen firsthand

This confluence of challenges and uncertainties is both

what's possible when we come together - our leaders

overwhelming and daunting, even to the seasoned

and employees as one RCBC family, as well as our loyal

bankers of RCBC who have seen the best and the worst

customers and shareholders as our steady partners.

of times. But if there's one thing we know for certain, it's

that managing the unpredictable is possible only when

On behalf of the Board of Directors, I would like to thank

we move together as one - as people with diverse skills

you for your contributions and commitment to RCBC's

but driven with a singular purpose to tackle complex

success and sustainable future. We look forward to being

problems and offer simple solutions to our customers.

with you on this continuing journey to LEAD FORWARD.

Despite a difficult global economic climate, we steeled

our nerves so that every aspect of our business could

deliver steady and sustainable revenue growth. We kept

our digital infrastructure robust, our brand reputation

HELEN YUCHENGCO-DEE

and internal controls strong, our culture of customer

service excellence energized, and our commitment to

Chairperson

sustainability steadfast.

The year began in fundamentally good form. Despite

concerns about the new Omicron variant of COVID-19,

the global economy was able to sustain its strong

momentum. Many economies reopened, manufacturing

Amid the increasingly volatile

expanded, and trade levels reached all-time highs. Then

came the war in Ukraine. By March 2022, the global

environment, 2022 turned out to

risk environment was markedly different as the Russia-

be the brightest year ever

Ukraine war compounded pandemic-related economic

challenges with rising inflation, higher energy supply

for RCBC.

costs, and supply chain disruption.

Global inflation led to hawkish monetary policy, with

the U.S. Federal Reserve raising key rates to one of the

Proof of our resilience is our performance in the past

steepest in history. This prompted the Bangko Sentral ng

three years. Amid the challenges of a global pandemic,

Pilipinas (BSP) to hike policy rates by a total of 350 basis

we continued to build a healthy earning asset portfolio,

points in 2022.

with a compound annual growth rate (CAGR) of 25%

since 2020. As we took full advantage of the reopening

Domestically, the economy started to recover, enabling

of the economy, our earning assets rose by 23%. Our

our GDP to return to pre-pandemic levels, rising to 7.6%

deposits grew by 27%, faster than the 12% industry

from 5.7% in 2021, among the fastest in the region. The

average. Loans to small and medium enterprises (SMEs)

strong consumption and pent-up demand among young

increased by 15%, and credit card receivables expanded

Filipinos drove our economic resurgence, and we started

by 41%. Investment securities climbed by 70%. By the end

to reap the demographic dividend.

of 2022, we emerged as the fifth-biggest privately owned

Ready to roll

"bank in the country with Php1.2 trillion in total resources.

Amid the increasingly volatile environment, 2022 turned

While we expanded our balance sheet, we managed to

out to be the brightest year ever for RCBC.

further improve our asset quality. Our net NPL ratio was

at 2.0% in 2022, delivering on the promise of improved

Our bottom line hit Php12.1 billion from Php7.1 billion in

credit and collection measures coming from the pandemic

2021 - a 71% leap. This resulted in a return on equity of

years.

11.2%, while return on assets improved to 1.2%.