ABOITIZ EQUITY Ventures, Inc. (AEV) said it has purchased around P270 million worth of shares in its banking unit, Union Bank of the Philippines, Inc. (UnionBank).

In a disclosure to the stock exchange on Tuesday, AEV said it purchased a total of 3.11 million common shares in Union Bank, priced at P90.75 apiece.

Sought for comment, AEV said the transaction brings its ownership in UnionBank to 49.12% of the total outstanding shares in the company, from 48.34% by the end of 2017.

The transaction follows AEV’s decision to consolidate it banking and financial service businesses last February. It earlier announced the signing of a share purchase agreement for the sale of its 51% stake in PETNET, Inc. to UnionBank’s subsidiaries, City Savings Bank, Inc. and Union Properties, Inc., for P1.2 billion.

AEV said the consolidation of its banking units will help unlock shareholder value for the company, given the synergies between the core businesses of CitySavings and PETNET.

UnionBank was the second largest contributor to AEV’s income in 2017, accounting for 18% of its P21.6-billion earnings last year. Its contribution to AEV however decreased by 16% to P4.1 billion from P4.9 billion in 2016.

The listed bank posted a 16.9% profit drop in 2017 to P8.4 billion due to the absence of one-off trading gains last year. On the other hand, core profit jumped 31% to P8.2 billion.

The lender also reported that its assets grew by 18.6% to P622.1 billion by the end of 2017, while total deposits rose to P447.6 billion, 18.9% higher year on year.

Meanwhile, AEV’s earnings were down by 4% to P21.6 billion in 2017, due to non-recurring losses which swelled to P2.3 billion against 2016’s P347 million. Excluding these one-off losses, AEV’s earnings would have increased by 5% to P23.9 billion.

Shares in AEV were up five centavos or 0.07% to P76 each, while shares in UnionBank dropped 75 centavos or 0.82% to end at P90.25 apiece at the Philippine Stock Exchange on Tuesday. — Arra B. Francia

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