4-Time Digital Bank of the Year
The Asset Triple A’s 4-time Digital Bank of the Year winner Union Bank of the Philippines (UnionBank) surpassed the globally challenging year with strong 2020 results, sustaining its digital leadership as it holds the distinction of being the only Philippine bank to receive the award four years in a row.
It set aside credit reserves due to COVID and still recorded a net income of Php11.6 billion in 2020. This translated to a return on equity of 11.5%, significantly higher than the industry’s 6.6% average.
At the Bank’s annual stockholders meeting on Friday, President and CEO Edwin Bautista said that as the pandemic accelerated the shift toward digital, the Bank experienced great traction including a 300% increase in digital take-up with more than 2.2 million digital customers to date; 43,000 accounts per month opened via UnionBank Online App during COVD which was 370% higher than pre-pandemic average, and the Bank is now the number 1 bank in ‘send transactions’ via Instapay and number 2 via PESONet.
Moreover, several partners “teched up” with the Bank’s help including the Department of Social Welfare and Development (DSWD) and the Bureau of the Treasury. Recently the Supreme Court of the Philippines entrusted the Bank to “Tech Up” their Judiciary Payment System so that its stakeholders can make digital payments to courts nationwide.
“UnionBank is going full throttle in our digital transformation. The Bank shall compress its five-year plans into two years by accelerating the digital onboarding of new customers. Our success today was a product of looking ahead into the future and preparing for the evolution of banking,” Mr. Bautista said. With the recent regulations, the Bank is gearing up for the entry of more digital banks and the anticipated shift towards an open finance environment. “We shall continue to launch pioneering solutions and test new technologies.”
With this, Mr. Bautista announced that the Bank is starting 2021 strong, posting a net income of P4.7 billion in the first quarter, which is 79% higher than the same period in 2020 and 53% higher quarter-on-quarter. This is despite additional provisions as credit buffer.
Net revenues were at Php14.3 billion, up 50% vs. the same period last year and up 39% vs. the previous quarter. Net interest income increased by 6% to Php7.2 billion despite muted credit demand. This was attributable to the robust growth of the current account and savings account (CASA) deposits, which was higher by 29% vs. the same period last year. Non-interest income rose by 2.6x to Php7.1 billion mainly driven by trading gains.
As of end-March 2021, total assets were at Php747.3 billion, nearly flat versus a year ago. Total loans and receivables were down by 12% to Php344.9 billion driven by weak demand for corporate loans. Total high-cost deposits were lower by 22% to Php222.8 billion as funding requirements were supported by low-cost CASA deposits.
“This digital shift motivates us to continue enhancing features across our digital platforms. We recently launched InstaPay 2.0 which enables fund transfers by inputting mobile numbers or email addresses. Also, small businesses can now open their business accounts and perform banking transactions digitally with the launch of our SME Business Banking App,” he added.
“We are confident that the Bank’s “Tech Up Pilipinas” efforts, focused on promoting wide-scale digital transformation, would allow all of us to weather this crisis and emerge more resilient than before. Together, we can power the Future of Banking and help ensure the renaissance of our nation,” Mr. Bautista said.
For more information on UnionBank, visit www.unionbankph.com