Union Bank of the Philippines, a unit of the Aboitiz Group and the eighth-largest lender in terms of assets, said net income in 2019 hit an all-time high of P14 billion, driven primarily by sustained strength of its core businesses.
The bank said in a statement Monday the 2019 net profit was more than double the earnings posted in the previous year. The profit translated into an above-industry return on equity of 16.3 percent and return on assets of 2 percent.
Bank president and chief executive Edwin Bautista told the Manila Standard the bank planned to surpass this year the remarkable performance in 2019. “We will try… the economic outlook is robust,” Bautista said in a phone interview.
He said in an earlier statement reaching the record income in 2019 was a timely achievement as the bank celebrated its 38th anniversary.
“I am glad of the strong growth we achieved and the superior returns we delivered amid integration of new subsidiaries and continued investments in digital transformation. Our digital strategy was key as we scaled up our businesses while maintaining lean operations,” he said.
Union Bank treasurer and chief financial officer Jose Emmanuel Hilado said the bank’s 2019 performance was supported by solid fundamentals given a healthy loan portfolio and steady margin recovery.
“Trading gains also boosted the bank’s bottom line. Moreover, CitySavings delivered their targets for the year given successes in the salary loans and motorcycle business,” Hilado said.
Revenues increased 44 percent from a year ago, driven by the sustained double-digit increase in loans, substantial margin growth and strong trading gains during the year. Customer loans rose 21 percent to P393.4 billion due to the solid business expansion in SME (+40 percent), credit cards (+35 percent), consumer loans (+31 percent), and commercial lending (+16 percent).
Margins rose 113 basis points from its bottom levels in January 2019, driven by asset repricing efforts, placement of funds in cost-efficient instruments, and the impact of cuts in policy rate and reserve requirement ratio during the year.
Union Bank’s total assets grew 15 percent to P770.9 billion as of end-December 2019.
Union Bank has always been among the first to embrace technological innovations to empower its customers. 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 recognitions including “Asia’s Best Bank Transformation” from Euromoney; three-time “Best Digital Bank Philippines” from Asiamoney; back-to-back “Digital Bank of the Year Philippines” from The Asset Triple A Awards; back-to-back Digital Transformer of the Year Philippines” from IDC’s DX Awards Philippines; and “Best Retail Bank Philippines” from Digital Banker.