ASIA United Bank Corp. (AUB) and its subsidiaries booked a higher net income in the first semester on the back of a strong topline performance.
The bank’s net profit rose by 17% to P6.1 billion in the six months ended June from P5.2 billion in the same period last year, it said in a disclosure to the stock exchange on Tuesday.
AUB said this was its highest first-half income so far.
This translated to a return on assets and return on equity of 3.3% and 21.1%, respectively.
The bank’s financial statement was unavailable as of press time.
“Sustaining our profitability since the pandemic is no mean feat, thanks to our robust core business and digital partnerships. We will remain relentless in our efforts to reach out to the unbanked and underserved, and in helping every Filipino achieve economic mobility,” AUB President Manuel A. Gomez said.
“Despite the downgraded growth forecast for the Philippine economy for this year mainly due to tariffs and trade uncertainty, geopolitical tensions, and other external headwinds, AUB remains optimistic it will hit its performance targets,” the bank said.
The bank attributed its strong first-half earnings results to the 13% growth in its revenues to P11.2 billion from P9.9 billion.
“Earning assets rose 21% to P382.6 billion from P316.5 billion, resulting in a 7% increase in net interest margin to P8.8 billion and a net interest margin ratio of 5%,” it said.
Non-interest income also climbed by 40% year on year to P2.4 billion on the back of higher trading and foreign exchange gains, service charges, and other fees from its operating activities, including credit cards, AUB PayMate, HelloMoney, remittance business, trust, and other branch-related transactions.
Meanwhile, AUB’s operating expenses increased by 8% to P3.6 billion due to higher compensation, capital expenditures, and business growth-related expenses.
This resulted in a cost-to-income ratio of 32.2%.
The bank added that its loan loss provisions increased by 134% year on year amid higher loan volume.
AUB’s loan book expanded by 36% year on year to P255.6 billion at end-June from P187.9 billion.
“Despite volume expansion, good asset quality was sustained with its nonperforming loan (NPL) ratio at 0.41% from year ago’s 0.43%. AUB remains sufficiently covered, with an NPL coverage ratio at 115.8%,” it said.
On the funding side, total deposits rose by 16% P325.8 billion. Of the total, 79% were low-cost current and savings account or CASA deposits, higher than the previous year’s 75% share.
AUB’s assets grew by 16% to P404.5 billion at end-June from P349 billion a year ago.
Total equity increased also increased by 26% to P64.9 billion, mainly from retained earnings.
The bank’s common equity Tier 1 ratio was at 18.13% and capital adequacy ratio was at 18.85%, up from 17.9% and 18.7% a year ago, respectively.
AUB’s shares rose by P1.10 or 1.99% to end at P56.50 each on Tuesday. — Aaron Michael C. Sy