This is what caused Metrobank's profit to increase 40% in 2012

Exceptional gains amounted to 23% of overall revenue.

According to Nomura, profit up 40% in 2012 boosted by exceptional gains and low taxes MBT posted a 40% y-y increase in 2012 profit, coming in 10% above our  estimate.

However, this was entirely due to (low-quality) exceptional gains which amounted to 23% of overall revenue, up from 17% in 2011. 

Here's more from Nomura:

Loan growth of 15% (1.5x nominal GDP) was in line with the 16% posted for 2011, but margins remain under pressure from falling interest rates. Costs to assets remain steady (at a relatively high 3.3%) whilst provisions were also flat (at a relatively high) at 91bps of loans.

MBT’s effective tax rate fell to 18% in 2012, from 29% in 2010.

Earnings risks
Our view remains that a combination of lower exceptional gains and a higher tax rate underpin (significant) earnings risks. Our 2013F forecasts are 16% below the Street (which is forecasting a 1% increase in earnings) on the back of a 15% drop in earnings.

This, in our view, reflects an increasingly challenging environment for investment gains against an interest rate backdrop that likely is close to bottom. Non-interest income to assets will therefore drop back to 1.4% in 2013-15F, on our estimates, in line with the average from 2009-11.

We expect MBT’s effective tax rate, which fell from 29% in 2010 to 18% in 2012, to rise to 21% in 2013F and to 27% by 2015F. We maintain our TP of PHP80, based on a GordonGrowth Model-derived target P/E of 13x and our 2013F earnings forecast of PHP6.18/share.

Against the weak earnings growth outlook and low return on assets (ROA) of 1.2% for 2013F (ROE of 10%), we reaffirm our Reduce rating.