UnionBank’s H1 profit down 17% but 2Q income surged 50%
Higher costs gnawed on the earnings of Aboitiz-led Union Bank of the Philippines in the first semester.
UnionBank said in a stock exchange filing on Monday that net income in the January to June period had slipped by 17 percent to P5.1 billion.
This was despite a 2.4-percent decline in operating expenses to P21.6 billion and the 8.3-percent improvement in revenues to P37.3 billion.
On the expenditure side, while it already lowered information technology expenses after the migration of Citi’s consumer business into its systems had been completed in March, UnionBank said this was offset by customer acquisition-related costs.
UnionBank previously said it was intensifying marketing activities to capture more clients and ensure that Citi customers stay with the Aboitiz Group’s banking arm.
The bank currently has over 15 million total clients, as its new-to-bank customers more than doubled compared with the previous year’s monthly average.
Meanwhile, the 8.3-percent revenue growth was driven by the bank’s expanding consumer business and higher transaction fees.
Net interest income grew 14.8 percent to P27.5 billion as its consumer loan portfolio swelled.
Despite the lower first-half earnings, UnionBank chief financial officer Manuel Lozano pointed out that in the second quarter alone, profits had increased by more than 50 percent.
“Our focus in higher-margin consumer segment and continued expansion of our customer base will allow us to sustain this growth momentum in the years to come,” Lozano said in a statement.
As of end-June, total assets of the country’s ninth largest bank were at P1.1 trillion.
UnionBank officially dropped the Citi brand earlier this year, sealing the P72-billion deal involving the transfer of around 1.5 million customers and transaction records.
