THE shift to mobile and digital banking boosted the performance of the Union Bank of the Philippines (UBP) in 2022.
In a disclosure to the Philippine Stock Exchange (PSE), the Aboitiz-owned bank reported a net income of P12.7 billion in 2022.
Unionbank disclosed that its net revenues reached a record high of P52.2 billion, a 16 percent increase year-on-year (YoY).
“In 2022, we witnessed a momentous shift in our business model. We have a solid balance sheet that continues to provide us above industry net interest margins,” said Executive Vice President and Chief Finance Officer Manuel R. Lozano.
“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,” Lozano added.
Unionbank said its earnings result translated to a return on average equity of 9.7 percent. This took into consideration the impact of the P40 billion additional capital from the Stock Rights Offer last May 2022.
“Revenues mainly came from net interest income and fee-based income, which compensated for the absence of trading gains,” Unionbank said.
The bank reported that its net interest income increased by 31 percent to P38.9 billion on account of higher margins and volume.
Net interest margins also expanded by 27 basis points to 4.9 percent driven by the higher proportion of consumer loans to total loans and the robust growth of low-cost CASA deposits or up to 29 percent year on year.
THE bank added that fees and other income doubled to P13.4 billion largely due to the consolidation of the acquired Citi consumer business, as well as growing digital customer transactions.
“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,” said Edwin R. Bautista, President and Chief Executive Officer.
“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,” he added.
Unionbank reported that total assets reached P1.1 trillion, 31 percent higher than prior year. Customer loans jumped by 42 percent to P479.2 billion, resulting from the combined growth in UBP and CitySavings consumer loans, as well as the acquired Citi consumer business.
Total deposits went up by 25 percent to P711.3 billion due to the overall expansion of the retail customer base and the strong take up of cash management products from large corporations.
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,” Bautista said.