Asia United Bank Q1 profit up 62%

The Rebisco group’s banking arm Asia United Bank grew its first-quarter net profit by 62 percent year on year to P523 million on higher loan volume and trading gains.

Interest income stood at P734 million in the first three months. The financial results translated to an increase in return on equity to 18.3 percent from 15.5 percent a year ago, the bank reported on Friday.

Starting Monday, AUB will embark on an international road show in Hong Kong, Singapore and London for its initial public offering worth as much as P9.68 billion.

The bank plans to sell up to 88 million common shares, with the public getting over a quarter of its post-IPO outstanding shares.

AUB expects to sell 70 percent of shares to foreign investors while the remainder will be for local investors.

At the local market, existing AUB customers will be given priority in the IPO allocation, top officials said in an investors’ briefing on Friday.

At the indicative price range of P80 to P110 a share for the IPO, AUB expects to sell at a price multiple of 1.3 to 1.6 times of book value, AUB president Abraham Co said in a briefing.

AUB’s estimated book value is P62.14 a share immediately following the IPO.

Based on analysts’ estimates, listed Philippine banks are currently trading at an average of 2.57x price-to-book value, with Union Bank having the lowest multiple at 19x and Bank of the Philippine Islands at 3.9x.

AUB expects to build up its assets to P250 to P300 billion in five years through a combination of organic expansion and prospective acquisitions. This is in line with its goal to join the roster of the country’s top 10 banks in five years. At end-March, total assets stood at P69 billion.

Based on the latest data from the Bangko Sentral ng Pilipinas, AUB ranked 20th among 37 operating commercial and universal banks in the country.

As part of the strategy, the bank plans to double its branch network to 250 by 2015 from 114 branches at present.