Asia United Bank, the banking arm of the Rebisco Group, said Tuesday net income jumped 42 percent in the first half of 2023 to P4.1 billion from a year ago, boosted by sustained strength of core businesses.
AUB president Manuel Gomez said in a statement they remained vigilant for potential headwinds amid the hawkish monetary policy stance despite the continuous improvement in consumer and business confidence.
“However, we see plenty of opportunities in greater collaboration within and outside the organization, particularly in digital transformation, and this gives us confidence in sustaining our gains,” Gomez said.
AUB’s net income grew 32 percent in the second quarter to P2.1 billion. Total operating income rose 26 percent to P4.4 billion, owing to the increase in both net interest income and non-interest income.
The first-half bottom line translated into higher return on equity of 20.3 percent and return on assets of 2.6 percent.
Total operating income climbed 30 percent to P8.9 billion on the back of a 28-percent increase in net interest income to P7.4 billion. Non-interest income went up 41 percent to P1.5 billion.
Loan volume increased 9 percent to P190.5 billion, led by growth from corporate and consumer loans as confidence in the economy further improved in the first half. This resulted in a wider net interest margin of 5 percent from the previous year’s 3.8 percent.
Strong contributions to the increases in service charges, fees and commissions, securities trading gains and foreign exchange gains came from AUB’s operating activities such as remittance, credit cards, trust, AUB PayMate and trading businesses.
Total deposits reached P269.9 billion, with low-cost CASA (current account/savings account) deposits comprising 72.5 percent of the total, while loan-to-deposit ratio stood at 70.57 percent.
Operating expenses in the first six months rose 13 percent to P3.1 billion, primarily from the compensation increases and transaction volume-related expenses. Despite the increase, AUB’s cost-to-income ratio stood at 34.8 percent, lower than the previous year’s 40 percent.
AUB said while loans increased, the group maintained its asset quality, with a non-performing loans ratio of 0.85 percent, below the banking industry’s overall NPL ratio of 3.46 percent in May, according to the latest data released by the Bangko Sentral ng Pilipinas.
AUB recognized provisions of P952.0 million year-to-date, 86 percent above the P510.8 million in the same period last year, strengthening its NPL coverage ratio to 114.8 percent as of June 30, 2023, from 79.8 percent a year ago.
Total assets reached P327.7 billion as of end-June 2023. Total equity was at P43.8 billion, with an indicative common equity tier 1 ratio of 15.42 percent and a capital adequacy ratio of 16.00 percent, above regulatory requirements. AUB is known for its digital innovations, which started years prior to the COVID-19 global pandemic. Among its digital innovations are e-wallet HelloMoney, pioneering payments via QR and the early adoption of the national QR PH code and AUB PayMate—an all-in-one digital payment acceptance product.