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UNION BANK of the Philippines, Inc. (UnionBank) has allotted P10.96 billion of the P11.82-billion net proceeds from its stock rights offer last year for loans.

The lender used more than 90% of the proceeds for loans, while the rest was infused into its digital arm, Union Digital Bank, Inc., it said in a stock exchange filing on Tuesday.

“The net proceeds of the stock rights offer are intended for capital infusion to UnionDigital, loan availments and/or other business growth opportunities,” it said.

UnionDigital is the listed lender’s digital bank, which got a license from the Bangko Sentral ng Pilipinas in July 2021. It started operating a year later.

The Aboitiz-led bank in January last year offered 210.97 million shares to raise P12 billion with an entitlement ratio of one rights share per 10.1536 common shares as of Jan. 12, 2023.

In November last year, the lender infused P1.8 billion in capital into UnionDigital to support its growth and operations.

This was in addition to the P900 million capital infusion into the bank’s digital arm last year, approved by UnionBank’s board of directors in June.

UnionBank’s net income dropped by 58.99% year on year to P1.65 billion in the third quarter from a year earlier as it set aside more loan loss provisions.

Its shares were unchanged at P45 each. — Aaron Michael C. Sy