UnionBank posts lower 9-month profit

Aboitiz-led Union Bank of the Philippines said earnings in the nine months through 2018 declined due to lower margins.

Union Bank said net income from January to September this year hit P6.1 billion, down 4.6 percent. Net revenues during the period amounted to P18.9 billion, up 3.3 percent.

“The rise in interest rates and the absence of new loan releases to teachers have affected our margins. We expect margins to improve as assets reprice and now that CitySavings’ access to DepEd’s automatic payroll deduction system has been resolved. We remain confident in sustaining our robust earning asset growth, which shall be supported by our successful P10-billion rights offering,” Jose Emmanuel U. Hilado, UnionBank treasurer and chief financial officer, said in a stock exchange filing on Monday.

UnionBank posted an annualized return on equity (ROE) and return on average assets (ROA) of 11 percent and 1.3 percent, respectively.

It highlighted gains in its customer businesses. Total loans increased by 18.6 percent year-on-year to P315.3 billion, with retail loans accounting for 33 percent of total loan portfolio.

This boosted the bank’s total assets to grow by 17 percent to P643 billion. Assets were mainly supported by deposits at P441.4 billion.

“We continue to refine our transformation strategy toward delivering superior customer experiences. Our mobile banking app was recognized as the Online Banking Initiative of the Year in the 2018 Asian Banking & Finance Awards. More important than this are the positive customer feedbacks on its new features, such as fund transfer to other banks without the need for branch-based account enrolments. Also, in one month we have onboarded more than 100 blockchain cadets for our Blockchain Institute. We are now ready to cocreate technology platforms for various ecosystems,” Edwin R. Bautista, UnionBank president and CEO, said in the same statement.