Union Bank to pick new president among 3 candidates

MANILA, Philippines – Local commercial bank Union Bank revealed they have at least 3 potential candidates lined up to replace its President & Chief Operating Officer Victor B.  Valdepeñas Jr. who has hit the mandatory retirement age of 65. 

Valdepeñas has headed the banking arm of the Aboitiz Group for about 14 years, or since 1998. His retirement has been one of the anticipated high-level movements in the industry.

“For the meantime there are no plans for him to retire. But we are very much focused on a succession plan,” said Union Bank CEO Justo A. Ortiz after the company’s annual stockholder’s meeting on May 24.

He said the company had “hired a few heavy hitters” in the banking industry who could potentially replace the longtime president and COO. He emphasized that they had been on the lookout for candidates with experience in treasury service, which the bank considers one of its core strengths.

“Two of them have very strong treasury backgrounds… [since] the focus of being able to continue a treasury business over the long term is very much part of the succession plan,” disclosed Ortiz.

“Although the 3rd one [has] no treasury experience [and] used to teach mathematics in university so i think it won’t be difficult for him to appreciate,” he added.  

Ortiz believed that, regardless of who is at the helm of the company, the bank will chart the same course.

“I think clearly trading securities will continue to be an important part of our strategy. We have the capital to support it. We’re leveraged barely 6 to one, which is a lot lower than most institutions. Our CAR is now 19% and most of it is Tier-1 CAR,” said Ortiz.

CAR refers to Capital Adequacy Ratio, which measures the proportion of the bank’s capital to its risk. Tier-1 refers to capital which can absorb losses without a bank being required to cease trading.

Ortiz added, “Our game plan over the next 10 years is obviously to balance these securities by generating more customer based revenues, principally from areas where we did not have a strong hand in the past, which is the consumer finance sector and small and medium scale businesses.

“Those portfolios grew last year by 50% in terms of volume, as compared to 5% portfolio growth of our corporate business so clearly that strategy is working and we will continue to emphasize it in the years coming to better balance our revenue streams,” said Ortiz. – Rappler.com