The Aboitiz Group’s lender Union Bank of the Philippines (UnionBank) reported that its net income jumped 55 percent to P3.1 billion in the second quarter of 2024 from P2 billion in the same period last year.

“We continue to post strong topline revenues. Now that we have completed the integration of the acquired Citi consumer business, the parent bank’s expenses have naturally declined," said UnionBank Chief Financial Officer Manuel R. Lozano.

“As a result, our net income in the second quarter of the year…is up by more than 50 percent… Our focus on higher margin consumer segment and continued expansion of our customer base will allow us to sustain this growth momentum in the years to come,” he added.

The bank said it continues to deliver strong top-line revenues at P37.3 billion in the first half of 2024. This represents an 8.3 percent increase versus the same period last year.

The growth in net revenues is driven by the bank's expanding consumer business, higher net interest margin, and growing transaction fees.

However, UnionBank has yet to disclose its first-half profit. For the first quarter, it reported a 41 drop in net income to P2 billion from the P3.4 billion earned in the same period last year due to costs related to integrating Citi’s consumer business.

Net interest income for the first half of 2024 grew by 14.8 percent to P27.5 billion, driven by a 55bps improvement in net interest margin.

The bank said its net interest margin is among the highest in the banking industry, at 5.7 percent, due to the higher proportion of consumer loans to total loans.

Consumer loans now account for 59 percent of its total loan portfolio, which is nearly three times higher than the industry average.

The bank's operating expenses increased by 2.4 percent year-on-year to P21.6 billion. Following the successful migration of the acquired Citi consumer business into UnionBank’s system in March, the bank’s IT expenses have declined by close to P1 billion quarter-on-quarter.

The decline in IT expenses was partly offset by inherent costs related to customer acquisition and revenue growth. New-to-bank customers more than doubled versus last year’s monthly average. As a result, the Bank now has over 15 million total customers.

Total assets as of June 2024 ended at P1.1 trillion. Total loans and receivables – net reached P514.8 billion, while low-cost CASA deposits at P427.8 billion.