Despite the continuing Covid-19 pandemic that has greatly impacted the Philippine economy, Union Bank of the Philippines (UnionBank) continues to register solid growth especially as it delivers more innovative – and often unparalleled – digital banking solutions to its customers. The Bank attributes this to its digital transformation journey that started four years ago – well ahead of its peers — and which enabled it to become the fast-&-agile institution that it is today.
In its latest financial statement, UnionBank recorded a net income of Php 4.2 billion for the 3rd quarter of the year, an 11% increase compared to the same period last year. This was fueled by a 27% growth in Q3 Net Interest Income vs. 2019, due both to significant margin improvement and expansion of its loan offerings and channels. In addition, fee income increased by 18% to Php 621.7 million reflecting the bigger scope and breadth of its services.
Year-to-date (YTD), the Bank’s net income was steady at Php 8.5 billion, just 0.9% lower year-on-year (YoY). This amount already includes the extraordinarily-high provision for loan losses, which could result from the Covid crisis, that it set aside earlier this year. With this Net Income performance, UnionBank’s return on equity (R.O.E.) is a stellar 11.6%.
From January to September 2020 Revenues grew by 33% YoY to Php 31.8 billion as net interest income expanded by 36% to Php 21.4 billion, from the continued growth of earning assets and higher margins compared to the same period last year. Importantly, non-interest income rose 26% to Php10.4 billion, due to higher trading gains.
Total deposits, on the other hand, increased by 29% YoY to Php 539.9 billion. Driven by robust growth in CASA deposits (+33% YoY) and lower funding cost, the net interest margin for the first nine months of the year increased by 92bps to 4.6%.
As of September 30, 2020, total assets were at Php 758.0 billion, up 11% compared to last year.
The latest results of UnionBank, despite the current weakened state of the economy, are proof of the Bank’s success in digitizing the whole organization to the core and effectively “future-proofing the business” by giving it agility and scalability in the face of major disruptions, such as the Covid pandemic.
UnionBank President and CEO Edwin R. Bautista added: “Four years ago, we pursued digital transformation in order to survive the winds of disruption. It was a matter of survival. We took it to heart and embarked on a mission to transform our bank to be competitive in the 4th Industrial Revolution by becoming digital to the core. We may now look like a different bank, but our purpose remains the same: to elevate lives and fulfill dreams, with the goal to co-create innovations for a better world,”
With the company now deploying the next phase of its digital transformation journey, which includes emerging world-leading technologies such as artificial intelligence, robotic process automation, and data-science, UnionBank remains firm in its commitment to “Tech Up, Pilipinas” and enable inclusive prosperity to fuel sustained growth, and LEAVE NO ONE BEHIND, in the process.