Aboitiz-led Union Bank of the Philippines (UnionBank) expects its earnings to improve soon even as continuing costs for the expansion of its credit card business weighed net income down by 35 percent to ₱3.3 billion in the first half of 2025 from ₱5.07 billion in the same period last year.

The bank disclosed to the Philippine Stock Exchange (PSE) that total revenues grew 9.2 percent to ₱39.7 billion year-on-year, fueled by higher net interest income and an expanded fee-income base.

The top-line performance provided a cushion to the impact of credit costs as a natural result of the significant addition of new credit card customers to the bank’s retail base and from its subsidiaries.

This, together with one-time costs aimed at enhancing operational and financial resiliency, resulted in a lower net income of ₱3.3 billion for the first half of 2025.

“As we continue our efforts to grow our customer base, we are also ensuring we enhance operational resilience to be able to deliver our desired customer experience,” said UnionBank President and Chief Executive Officer (CEO) Ana Aboitiz Delgado.

She noted that, “These strategic moves come with upfront costs booked in the first half of 2025. This positions us to better reflect the bank’s true performance moving forward.

“Our top line has consistently shown an encouraging trend, and with lower costs ahead, we anticipate improved net income in the coming months. These efforts position the bank for a more resilient, sustainable, and accelerated trajectory as we enter the next phase of our growth journey.”

Net interest income rose significantly, supported by a 61-basis-point (bp) increase in net interest margin to 6.4 percent in the first half of 2025, driven by continued growth in the bank’s high-yielding consumer portfolio—particularly in credit cards and personal loans—underpinned by continuous customer acquisition and cross-sell initiatives.

Funding costs also improved amid a declining interest rate environment and an increase in the share of low-cost current account/savings account (CASA) deposits. The bank’s CASA ratio improved to 65.2 percent, underscoring the strength of its transaction banking franchise.

UnionBank’s retail customer base reached 18 million as of the first half of 2025, contributing to higher transaction volumes and a 17.1-percent year-on-year increase in fee income.

The bank’s fees-to-assets ratio stood at 1.3 percent, among the highest in the industry, reflecting its strong ability to generate fee-based revenues relative to its size.