Union Bank of the Philippines is expected to take over the consumer business of Citibank Philippines by July, a top executive said Tuesday.
UnionBank president and chief executive Edwin Bautista said the bank is on track to achieving the strategic milestones that it set for the year.
“For the acquisition of Citi’s consumer business, we have already obtained approvals from the Philippine Competition Commission and Insurance Commission,” said Bautista.
“Our stock rights offering, which will fund the acquisition, is already in motion and expected to conclude in May 2022. We remain confident to become the legal owner of the consumer portfolio by July 2022,” he said.
“Moreover, our digital bank UnionDigital, is also on-track to launch by the second half of the year. We are closely working with the regulators to complete key requirements for the start of our operations,” said Bautista.
UnionBank booked a net income of P2.6 billion in the first quarter, down by 45 percent from a year ago when it recorded hefty extraordinary trading gains.
Recurring income grew 21 percent year-on-year as net interest income rose 12 percent to P8.1 billion and fee-based income more than doubled to P1.4 billion.
It said net interest margin improved by 6 basis points to 4.6 percent brought about by higher yields in earning assets, coupled by lower cost of funds from the expansion of our current account-savings account deposits. Fee-based income came from the growth of InstaPay charges and interchange fees. Higher foreign exchange income, which went up 53 percent to 369.5 million, also boosted topline revenues.
The bank said that on a quarterly basis, net income grew 40 percent from the fourth quarter on lower provisions for credit losses.
UnionBank said that as of end-March, total assets reached P844.4 billion, or 13 percent higher than in the same period last year.
Total loans and receivables rose 2 percent to P351.8 billion, while total deposits went up by 15 percent to P577.2 billion, driven by the 28-percent growth of CASA deposits to 356.5 billion.
“The optimism generated by the reopening of the economy is palpable and if the pandemic is behind us, we are hopeful that the economic gains since 2021 are sustainable. While the ongoing Russia-Ukraine conflict could adversely affect investor and consumer sentiment, we think that the country’s economic fundamentals are strong enough to weather the challenges ahead,” said UnionBank treasurer and corporate planning services head Jose Emmanuel Hilado.
“We, therefore, remain optimistic that improving credit appetite and spending patterns will allow us to sustain momentum in our recurring income for the rest of 2022,” said Hilado.