By Anna Gabriela A. Mogato
Union Bank of the Philippines, Inc. (UnionBank) recorded a lower net income in the first nine months of 2018, dipping to P6.1 billion from P6.4 billion in the same period last year, despite sustained double-digit growth in customer business.
In a disclosure to the stock market on Monday, UnionBank Treasurer and Chief Financial Officer Jose Emmanuel U. Hilado said that their margins were affected by the increase in interest rates and lack of new loan releases to teachers.
“We expect margins to improve as assets reprice and now that CitySavings’ access to DepEd’s automatic payroll deduction system has been resolved,” he added. CitySavings is the thrift bank subsidiary of UnionBank
“We remain confident in sustaining our robust earning asset growth which shall be supported by our successful Php10 billion rights offering,” he added.
Overall loans grew 18.6% year-on-year to P315.3 billion, boosting Unionbank’s total assets by 17% year-on-year to P643 billion. The Aboitiz-owned bank’s assets are mainly supported by deposits valued at P441.4 billion.
The company’s net revenues, on the other hand, grew by 3.3% to P18.9 billion from P18.3 billion a year ago.
This third-quarter performance translated to an annualized Return on Equity of 11% and a Return on Average Assets of 1.3%.