ASIA UNITED Bank Corp. (AUB) targets to grow its net profit by 30% to P4 billion this year on hopes that improving consumer confidence will boost its lending business, it said in a statement on Friday. 

AUB’s net income dropped 38% to P736 million in the first quarter from a year earlier as it boosted its loan loss provisions. In 2020, the bank’s net profit was down by 32% to P3 billion from P4.4 billion in 2019. 

“2021 will definitely be a better year than 2020 as we expect the vaccine rollouts by the government and the private sector to improve consumer confidence and lead to increased economic activity. These, in turn, will boost our commercial and consumer lending business, which remain stable,” AUB President Manuel A. Gomez was quoted as saying. 

“We anticipate the new wave of loan bookings as the economy opens up. We are therefore cautiously optimistic that as the economy normalizes, the asset quality compared to 2020 will significantly improve, not only for AUB but for the entire banking industry,” he said at the bank’s virtual annual stockholders’ meeting on Friday. 

Mr. Gomez said the bank will continue to ramp up spending for its IT infrastructure, which was also its goal in the previous year. 

“That will remain as IT will always be essential in order for us to keep up with the changing environment,” he said.  

Even as he expects economic conditions to improve due to the gradual return of business activities, Mr. Gomez said the banking industry needs to continue to guard against risks that may arise due to the pandemic and the impending tightening of monetary policy measures. 

“We must also be prepared for tightening regulations and increasing credit costs as the Bangko Sentral [ng Pilipinas] tries to stave off inflationary pressures and significant stress on the banking system,” Mr. Gomez said. 

“We have yet to feel the full effects of the pandemic to personal incomes and business viability. We must still brace ourselves for some pockets of turbulence,” he added. 

AUB Chairman and Chief Executive Officer Abraham T. Co, for his part, said the bank will likely mix working from home and from the office as needed moving forward. 

“We have learned a lot how to work differently. Some people work better at home, some people don’t,” Mr. Co said. 

AUB’s shares closed at P43.80 apiece on Friday, down by 20 centavos or 0.45% from the previous day. — LWTN 

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