Union Bank of the Philippines delivered a net income of P6.4 billion in the first six months of 2023, up by 6% against the same period last year.
Net revenues for the first half of the year amounted to P34.4 billion, increasing by 60% versus the same period last year.
Net Interest income grew 41% to P24.0 billion, largely attributable to the 43% increase in the Bank’s loan portfolio plus better net interest margin. Net interest margin increased by 60 bps to 5.2%. The Bank’s strong focus on high- yielding consumer loans more than offsets the impact of the rising cost of funds. The Bank’s proportion of consumer loans to total loans improved to 55% this year versus 42% last year.
Fees and other income more than doubled to P10.5 billion, primarily due to card-related transactions, digital transactions, and the growing base of the Bank’s key subsidiaries.
Operating expenses were up by 82% to P21.8 billion on account of one-time integration cost of the acquired Citi consumer business and the establishment of UnionDigital. Excluding the planned costs attributed to these new business segments, the increase in operating expenses was in line with volume growth.
Total assets as of June 2023 amounted to P1.1 trillion, up by 27% from June 2022. Net loans and receivables climbed up by 43% to P522.2 billion, while total deposits increased by 25% to P693.3 billion.
“We consider this year as a period of investing for our future. Our costs will temporarily be elevated this year, while the integration of the acquired Citi consumer business is ongoing. Having said this, we have a healthy earning asset base. We have a well-diversified consumer loan mix and all segments are growing in double digits. As soon as we complete the Citi integration, we expect a substantial reduction in operating expenses that will bring us back to above-industry ROE we have been known to deliver,” said Manuel R. Lozano, Executive Vice President and Chief Financial Officer.
“All our consumer business-engines are running in full speed. We now have over 12 million customers. The acquired Citi business is contributing around one-third of our income today. CitySavings continues to be a market leader in providing salary loans. UnionDigital is already profitable and growing fast. This kind of momentum gives me confidence that UnionBank will achieve its goal of becoming the largest and most profitable retail bank in the Philippines by 2025.” said Edwin R. Bautista, President and Chief Executive Officer.
Union Bank of the Philippines (UnionBank) has always been among the first to embrace technological innovations to empower its customers. Undoubtedly the Philippines’ pioneer in digital banking, UnionBank is committed to be the region’s digital trailblazer to best serve the growing needs of Filipinos everywhere.
It has consistently been recognized as of one of Asia’s leading companies, ranking among the country’s top universal banks in terms of profitability and efficiency.
Over the years, UnionBank has garnered a record-breaking number of awards and recognition including “Asia Trailblazer Institution of the Year” from Retail Banker International; “Best Retail Bank in Southeast Asia 2023” from Capital Finance International; 6-Time “Digital Bank of the Year (2018-2023)” from The Asset Triple A; “Most Recommended Bank in the Philippines 2023” and 4-time “Best Retail Bank in the Philippines” from The Asian Banker; “40 Years of Excellence in Retail Banking Philippines 2023” from Global Banking and Finance; “Best Private Bank, Philippines 2023” from The Digital Banker; “Best Digital Bank in Southeast Asia 2022” from Capital Finance International; back-to-back “Best Bank for Customer Experience in Southeast Asia” from Global Brands Magazine; “Best Bank Transformation in South East Asia 2021” from Global Banking and Finance; “Most Recommended Retail Bank in Asia Pacific 2021” from BankQuality.com; “Fastest Growing Fintech Company, South East Asia 2021” for UBX from Global Banking and Finance; “Best Bank for ESG 2022” from Asiamoney; back-to-back “Best Bank for SMEs” (2020-2021) from Asiamoney; “SME Bank of the Year – Philippines 2021” from Asian Banking and Finance; back-to-back “#1 Best Service Domestic Bank in the Philippines 2020-2021” at the Asiamoney Cash Management Survey; “Asia’s Best Bank Transformation” from Euromoney; “Asia-Pacific Retail Bank of the Year” from Retail Banker International; “Top 2 Most Helpful Banks in Asia Pacific during COVID-19” from BankQuality.com; 3-time “Best Digital Bank Philippines” from Asiamoney and International Finance Magazine; and “Employer of the Year” awards from Stevie Awards for Great Employers, Asian Banking and Finance, and HR Asia.
On its aspiration to become a Great Retail Bank, UnionBank is determined to be an enabler of the Philippines’ bid to be a G20 country by 2050. It stands firm in its promise to power the future of banking through “Tech-Up Pilipinas” while co-creating innovations for a better world.