Union Bank of the Philippines said its net income grew slightly to P12.7 billion last year from P12.6 billion in 2021 on the back of record revenues.
In a statement, the Aboitiz-led bank said the 2022 profit translated to a return on average equity of 9.7 percent, which takes into consideration the impact of the P40 billion additional capital coming from the stock rights offer in May last year.
Net revenues rose 16 percent to an all-time high of P52.2 billion, mainly coming from net interest income and fee-based income, which compensated for the absence of trading gains.
Net interest income jumped 31 percent to P38.9 billion on account of higher margins and volume. Net interest margins expanded by 27 basis points to 4.9 percent driven by the higher proportion of consumer loans to total loans and the robust growth of low-cost CASA deposits.
Fees and other income doubled to P13.4 billion largely due to the consolidation of the acquired Citi consumer business, as well as growing digital customer transactions.
Total assets expanded by 31 percent to P1.1 trillion. Customer loans surged 42 percent to P479.2 billion, resulting from the combined growth in UBP and CitySavings consumer loans, as well as the acquired Citi consumer business.
Total deposits went up by 25 percent to P711.3 billion due to the overall expansion of the retail customer base and the strong take up of cash management products from large corporates.
“In 2022, we witnessed a momentous shift in our business model. We have a solid balance sheet that continues to provide us above industry net interest margins. The shift in digital also allowed us to grow our fees coming from mobile fund transfers and payments. We were able to book the same bottomline as the previous year, but with less reliance on trading,” said Manuel R. Lozano, EVP and chief finance officer.
UnionBank president and CEO Edwin R. Bautista said the bank reaped benefits from the strategies it implemented last year.
These include the seamless integration of the acquired Citi consumer business, which includes customers and employees, and the commercial launch of UnionDigital as one of the six digital banks licensed by the Bangko Sentral ng Pilipinas.
“We delivered on our promise and the market has rewarded us for it. Our recent stock performance, increase in stock trading volumes, and the strong commitment from our major shareholders on our stock rights offering reflect shareholders’ trust in the value that will be created from the execution of our strategies,” Bautista said.