AUB income rises to P5.2 billion in H1

MANILA, Philippines —  Rebisco-led Asia United Bank saw its net income increase by 27 percent to P5.2 billion in the first semester on the back of higher revenues and better credit quality.

In a disclosure to the local bourse, AUB and its subsidiaries posted a P5.2 billion net income from January to June, P1.1 billion higher than the P4.2 billion in the same period a year ago.

“Thanks to the improving business environment, AUB continues to deliver consistent performance in the first half of the year,” AUB president Manuel Gomez said.

AUB’s earnings translated to a return on assets of 3.1 percent and a return on equity of 21.9 percent.

The bank’s interest income from its loan portfolio and investment activities rose in the first half, widening its net interest margin by 10 percent to P8.2 billion. This led to a net interest margin ratio of 5.4 percent from the previous year’s five percent.

The bank also attributed the higher profitability to better asset quality. AUB’s non-performing loan (NPL) ratio stood at 0.43 percent as of June, an improvement from the previous year’s 0.9 percent.

AUB also saw a 92-percent decline in loan loss provision to P78. million from P952 million, previously.

“The bank remains sufficiently covered from probable losses with an NPL coverage ratio of 150.8 percent from 114.8 percent a year ago,” the bank said.

Meanwhile, operating expenses grew by seven percent to P3.3 billion in the first half mainly due to higher compensation, capital expenditures and investments in further business growth.

Despite the increase, AUB said it continues to show operational efficiency with a cost-to-income ratio of 33.5 percent as of June.

The lender’s total assets inched up by six percent to P349 billion year-on-year. Its total loan portfolio stood at P187.9 billion, sufficiently funded by P281.1 billion in deposits with a loan-to- deposit ratio at 66.8 percent.

Low-cost deposits also remained the primary source of funding for AUB, comprising 75 percent of total deposits, higher than the previous year’s 72 percent.