Union Bank Of the Philippines (UBP), the financial arm of the Aboitiz Group, is injecting more funds into its online banking arm to support expansion.
UBP said in a disclosure to the stock exchange Tuesday its board of directors approved the infusion of additional capital of up to P1.6 billion in UnionDigital Bank Inc.
The additional capital will be used to “support UnionDigital’s ongoing business operations and allow it to deliver sustainable growth”.
The capital infusion is subject to the applicable regulatory approvals.
UnionDigital Bank is one of the six Bangko Sentral ng Pilipinas-licensed online banks in the country, along with GoTyme Bank; Tonik Digital Bank, Inc.; Maya Bank; Overseas Filipino Bank; and UNObank. It started operation in July 2022.
UBP also infused additional capital to UnionDigital in tranches in 2023 for a total of P900 million. Its board also approved the infusion of additional capital of up to P1.8 billion to UnionDigital to support business growth.
Since the start of 2024, UBP infused P600 million, P800 million and P400 million in the digital bank. As of end June 2024, UBP’s total equity investment in UnionDigital amounted to P5.7 billion.
UnionDigital Bank in 2023 registered a significant growth in its balance sheet, with an increase in both deposits and loans, more than doubling its previous performance.
It said that as of December 2023, the bank attained a substantial 65-percent market share in loan portfolio size, while in deposit, it ranked second among digital banks with a 25-percent share.
The period also marked a significant milestone as UnionDigital Bank achieved profitability in 2023, showcasing extraordinary growth with revenue soaring by 13 times to over P5 billion.
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