Security Bank asks PSE to lift penalty after it announced growth estimates

MANILA, Philippines - Security Bank Corp. requested the Philippine Stock Exchange (PSE) to lift its P50,000 penalty, denying that its announcement of “double-digit" growth this year will encourage speculation. The bank “faithfully abides by the rules on prior disclosure to the exchange before dissemination of press releases to the media," Security Bank corporate secretary Joel Raymond R. Ayson said in a letter to the bourse. “The statement…that [the bank] ‘…expects to post double-digit growth in net profit this year’ is clearly a forward looking estimate of the bank's future growth," said Ayson’s letter which was addressed to regulation division head Roy Joseph M. Rafols. “Although the statement is consistent with the bank's current financial position, such projection can change with time. The fact that [the bank] merely expects growth is by no means an assurance to the public as to enable them to ‘appraise their position or standing." Mere hope or expectancy can not be equated to a definite and assured outcome," the letter added. For its part, the PSE said the bank should have not disclosed to the media to avoid speculation if it considers net profit projection as “soft information." Citing Sec. 4 of the Revised Rules of Disclosure, the PSE said issuers are required "unstructured" disclosures to "update investing public with any material fact or event that occurs which would reasonably be expected to affect investors' decision in relation to the trading of its securities." However, Security Bank said the statement contained neither fact nor event that occurred. The statement was obtained through an ambush interview. "For (the bank) to say that it expects growth in net profit can not be considered factual more so an event that occurs which would reasonably be expected to affect investors' decisions. Thus, there was no obligation to immediately disclose such projection to the PSE," Mr. Ayson said. Security Bank shares closed unchanged at P28.50. - GMANews.TV