UNIONBANK of the Philippines, Inc. saw its net income surge in the second quarter on the back of strong net interest income growth and lower operating expenses.
In a disclosure on Monday, the Aboitiz-led bank said it posted a P2.6-billion income in the April-June period, up 44.4% from P1.8 billion tallied in the same period in 2018.
This brings UnionBank’s profit for the first half of the year to P4.8 billion, two percent higher than the P4.7 billion recorded in the comparative year-ago period.
The lender attributed the strong second-quarter income to “double-digit growth in net interest income and lower operating expenses.”
Net interest profit grew 18.2% to P5.2 billion in the second quarter from P4.4 billion a year ago as its earning asset base climbed and margins improved.
“The continuous improvement of our margins contributed to our strong topline results,” UnionBank Chief Financial Officer and Treasurer Jose Emmanuel U. Hilado was quoted as saying in the statement.
“(Operational expenditure) growth was also kept manageable amid the integration of PR Savings Bank with CitySavings and continued investments in digital transformation,” Mr. Hilado added.
CitySavings Bank, Inc., the thrift lending arm of UnionBank, completed the its consolidation with PR Savings Bank of the Ropali Group of Companies, paving the way for the Aboitiz-led bank to enter the motorcycle financing market.
Customer loans amounted to P328.3 billion as of end-June, driven by the expansion of credit cards, consumer business and commercial loans, which grew 39%, 31% and 16%, respectively, year-on-year.
For the first half of the year, the bank saw sustained growth in its earning assets despite lower margins and its investments in its digital transformation.
Overall, UnionBank’s assets stood at P704.5 billion, up 13.3% from P621.6 billion booked last year.
Edwin R. Bautista, UnionBank president and chief executive officer, said the bank is “clearly seeing the fruits” of its digital transformation push.
“Our improved efficiencies enabled us to onboard more retail customers into our platforms. We were able to manage expenses without slowing down on our strategic initiatives,” he said.
UnionBank shares closed at P60.10 apiece on Monday, up 10 centavos or 0.17%. — Karl Angelo N. Vidal