Asia United Bank, one of the fastest-growing publicly-listed universal banks in the country, said Monday it is increasing its authorized capital stock from P5 billion to P14.7 billion as it gears up for further expansion.
The bank’s board of director approved the increase in capital stock on May 26.
“The bank’s board of directors, upon recommendation of management, approved the declaration of a 50-percent stock dividend and the amendment of the bank’s articles of incorporation to increase authorized capital stock, subject to the approval of the stockholders in the annual stockholders’ meeting on June 23, 2023,” AUB said in a disclosure to the stock exchange.
This is subject to the approval of the Securities and Exchange Commission.
It said the increase in the authorized capital stock “will support future business expansion in line with the bank’s strategies and directions.”
The P5 billion authorized capital stock of the corporation is divided into 500,000,000 of common stock with par value of P10. With the increase, the P14.7-billion authorized capital stock will be divided into 1,470,000,000 of common stock with par value of P10.
AUB, established at the height of the 1997 Asian financial crisis, was one of two local commercial banks licensed at the time which has since thrived and expanded its operations.
It is known for its digital innovations, which started years prior to the COVID-19 global pandemic which spurred many of its competitors to embark on digital transformation.
AUB’s net profit climbed 54 percent year-on-year to P2 billion in the first quarter, on the back of increased commercial loan demand as the economy reopens and business activity picks up. This resulted in a return on equity of 19.9 percent and a return on assets of 2.5 percent.
Total operating income increased 35 percent to P4.5 billion on 31-percent increase in net interest income to P3.7 billion as a result of AUB’s loan portfolio which was 10 percent higher than a year ago at P185.0 billion.
Asset quality improved with its non-performing loans ratio at 0.95 percent, compared to 1.9 percent in the first quarter of 2022. Provision for losses increased by P300 million, strengthening its NPL coverage ratio to 114.3 percent from 81.5 percent year-on-year.
Total assets expanded by 5 percent year on year to P328 billion. Total deposits rose 5 percent to P273.0 billion, with low-cost CASA deposits comprising 72.97 percent of its total deposit base while its loan-to-deposit ratio stood at 67.8 percent.