Asia United Bank (AUB), controlled by Republic Biscuit Corporation (Rebisco) owner Jacinto L. Ng Sr., reported a record consolidated net income of P8.3 billion in 2023, reflecting over 32 percent increase than the previous year’s P6.3 billion, due to rising interest rates.
In a disclosure to the Philippine Stock Exchange (PSE), the bank said unaudited financial results showed a return on equity (ROE) of 18.6 percent and a return on assets (ROA) of 2.38 percent — both record highs since the bank had its initial public offering (IPO) in 2013.
The ROE and ROA rose from the previous year’s 16.1 percent and 1.9 percent, respectively.
“We attribute this vastly improved performance to our robust loan growth, more profitable net interest margin (NIM), continuously improving credit quality, and higher operating efficiency,” said AUB President Manuel A. Gomez.
In an environment of rising interest rates, AUB saw its NIM widen by 17 percent to P15 billion from 2022.
Credit quality, as measured by net non-performing loans (NPL), stood at 0.58 percent, well below the industry’s 1.60 percent. This led to reduced loan loss provisions of P1.2 billion, 27 percent lower than in 2022.
While operating expenses rose to P6.5 billion in 2023, the bank managed to improve its operating efficiency, as measured by its cost-to-income which further dropped to 36.3 percent from the previous year’s 37.6 percent.
Total assets grew by four percent to P355.1 billion while total deposits rose to P292 billion, with the bulk still comprised of low-cost CASA deposits.
Equity increased by 23 percent to P49.1 billion year-on-year, translating to a common equity tier 1 ratio of 16.88 percent and a capital adequacy ratio 17.49 percent — both well above the regulatory threshold.
“With our stronger performance in 2023, we expect to solidify our lead among the country’s top ten listed universal banks in terms of compounded annual growth rate (CAGR) on key indicators since AUB was listed on the bourse in 2013,” said Gomez.
With interest rates expected to remain elevated this year, and global shocks a continuing concern, Gomez said "We have to remain agile to sustain our performance.”