THE REBISCO group’s banking arm ASIA United Bank posted a 3 percent year-on-year dip in six-month net profit to P852.8 million, citing higher costs from its branch expansion alongside higher loan provisioning.
For the second quarter alone, net profit declined by 40 percent year-on-year to P403.86 million due to the decline in trading and securities gain.
For the first six months, AUB expanded its loan book by 41 percent year-on-year to P80.52 billion. With higher loan volume, AUB’s net interest income reached P2.2 billion in the first six months, 17.3 percent higher from the same period last year.
The expansion in AUB’s loan book was led by the commercial and consumer segments which respectively surged by over 50 percent and 28 percent. The bank thus expanded total assets by 16.6 percent year-on-year to P131.4 billion as of end-June.
“This is in line with the bank’s goal of having a stronger presence in the consumer loan segment through its branches and online delivery channels,” AUB president Abraham Co said.
Meanwhile, net interest margin was stable at 4.4 percent, the same level in the first six months last year.
The decline in six-month net profit was attributed to higher expenses arising from AUB’s investment in opening 29 more branches after June 30, 2014. This was alongside higher loan provisioning, which nudged up the bank’s total operating expenses by 27.6 percent year-on-year to P2.1 billion.
As of end-June, AUB had a consolidated network of 224 branches, of which 15 belong to its subsidiaries Cavite United Rural Bank and the Pampanga-based Rural Bank of Angeles.
On the funding side, total deposit base grew by 21.4 percent year-on-year to P100.7 billion, of which more than half consisted of low-cost demand and savings accounts.
In addition to growing its branch network to reach out to more customers nationwide, AUB said it’s also aggressively addressing the digital divide among customers by coming up with innovation-driven services.
As early as 2007, the bank pioneered “Preferred Online Banking,” which allows real-time fund transfer in any AUB account, as well as real-time viewing and printing of user’s daily transaction history, monthly statement of account, and images of issued and returned checks. These financial transactions include telegraphic transfers and bills payment, including Meralco utility payments.
Last year, AUB became the only bank in the Philippines to offer a Chinese version option in online banking in a bid to be more customer-friendly to a growing Chinese clientele.
Another pioneering feature of AUB’s “Preferred Online Banking” is its link with AUB’s virtual teller kiosk (VTK), which automatically queues user transaction in any bank branch in the Philippines. VTK eliminates the need for physical queuing and increases convenience with the next-generation iPad version.
“We are confident that our investments in our people, products, and processes will transform AUB into becoming a formidable player in the Philippine banking arena,” said AUB chief transformation officer Jacob Ng.