MANILA, Philippines - Union Bank of the Philippines posted a 44-percent growth in five-month net profit from a year ago, fueled by a strong expansion of earnings from core lending as well as trading activities.

The country’s eighth-biggest bank in assets disclosed to the Philippine Stock Exchange that it had booked a net income of P1.4 billion in the January-to-May period against P967 million a year ago as interest income from loans expanded 78 percent year-on-year to P2.9 billion on the back of a more robust loan portfolio and healthy margins.

Similarly, interest income from trading and investment securities improved 33 percent to P1.7 billion. As a result, total interest income reached P5.1 billion during the period, better by 42 percent from the same period last year. This was even as total interest expense rose 81 percent to P2.5 billion due to a ballooning deposit volume.

Justo Ortiz, bank chair and CEO, said: “Union Bank’s year-to-date performance in 2009 is a testament to the success of our twin strategy of strengthening our core business toward a more sustainable income stream while remaining on guard for trading opportunities amid the prevailing market volatility.”

Net interest income climbed 18 percent to P2.6 billion from a year ago.

Operating income for the first five months surged 53 percent to P1.6 billion from P1 billion in the same period last year, supported largely by the 243-percent upswing in trading and foreign exchange gains.

Operating expenses increased at a slower pace of 21 percent to P2.3 billion.