SUMMARY
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MANILA, Philippines – Aboitiz-led Union Bank of the Philippines (UnionBank) hit a net income of P12.7 billion in 2022, up slightly from its net income of P12.6 billion in 2021.
The bottomline figure, however, remained below the PSE-listed bank’s pre-pandemic net income of P14.0 billion in 2019.
Its net revenues climbed 16% year-on-year to a record high of P52.2 billion, although the bank failed to post trading gains in 2022. Net interest income and fee-based income made up the bulk of revenue.
Net interest income grew 31% to reach P38.9 billion, aided by the widening of net interest margins by 27 basis points to 4.9%. The universal bank attributed this larger margin to a higher proportion of consumer loans to total loans and more low-cost Current Account Savings Account deposits.
UnionBank’s acquisition of the Citi consumer business and the subsequent growth of its digital customer transactions also led to strong gains in its fees and other income, which doubled to P13.4 billion.
UnionBank’s total assets also expanded 31% from the previous year reaching P1.1 trillion.
Customer loans climbed 42% to P479.2 billion, with growth coming from UnionBank, CitySavings, and the acquired Citi consumer business. This also came with a 25% increase in total deposits which stood at P711.3 billion.
“We have a solid balance sheet that continues to provide us above industry net interest margins. The shift in digital also allowed us to grow our fees coming from mobile fund transfers and payments. We were able to book the same bottomline as the previous year, but with less reliance on trading,” said Manuel Lozano, UnionBank’s executive vice president and chief finance officer.
In mid-2022, UnionBank completed the acquisition of Citi’s consumer business. The blockbuster acquisitions – which propelled UnionBank up among the top three credit card issuers in terms of usage and spends – was mainly financed by a P40 billion Stock Rights Offering (SRO).
Taking into account the impact of the recent SRO, the fiscal year’s 2022 earnings yielded a return on average equity of 9.7%.
“At the start of 2022, we made a commitment to execute on key strategic imperatives. First, the seamless integration of the acquired Citi consumer business, which includes customers and employees. Second, the commercial launch of UnionDigital as one of the six digital banks licensed by the Bangko Sentral ng Pilipinas. We delivered on our promise and the market has rewarded us for it. Our recent stock performance, increase in stock trading volumes, and the strong commitment from our major shareholders on our Stock Rights Offering reflect shareholders’ trust in the value that will be created from the execution of our strategies,” Edwin R. Bautista, president and CEO, said in a press release.
UnionBank has also appointed new executives, following the resignation of Michael Regino and Ricardo Moldez as nominee directors of the Social Security System (SSS). Their unexpired terms will be served by Rolando Macasaet and Robert De Claro.
Macasaet currently serves as the president and chief executive officer of SSS. Besides being a nominee director of SSS in UnionBank, he will now also sit as a member of the executive committee, trust committee, corporate governance committee, and information technology and cybersecurity committee.
De Claro is a member of the Social Security Commission and serves as the president and chief executive officer of Transpotech and Services, OPC. Likewise, De Claro will sit as a nominee director of SSS and will also be a member of the risk management committee, audit committee, market risk committee, and operations risk management committee. – Rappler.com
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