MANILA, Philippines - United Coconut Planters Bank (UCPB) reported yesterday an 11-percent increase in net earnings in the first quarter of 2011 to P639 million from P576 million in the first three months of 2010.
In a statement, UCPB said while it was not spared from the weakening securities and foreign currency market, it was able to re-focus on building its loan portfolio, expanding its deposits, improving funding mix, and generating fee income.
Total loans amounted to P47.6 billion, 11 percent higher than the P43 billion in March 2010. The loan expansion pushed up the bank’s interest income by 11 percent to P2.1 billion from P1.9 billion.
Total deposits also expanded 11 percent to P144.5 billion from P129.8 billion. The bulk of the deposit growth came in the form of low-cost current account and savings account, enabling the bank to cut its interest expense 18 percent to P519 million from P631 million.
The combination of higher loan volume, lower cost of funds and better interest margins boosted UCPB’s net interest income 19 percent to P1.5 billion.
Revenues from service charges, fees, commissions and other non-interest income sources also rose 14 percent to P234 million. Earnings from subsidiaries went up five percent to P92 million.
Total resources reached P174.8 billion.
UCPB executive vice president and chief operating officer Cesar Rubio said he sees a stronger second quarter as the five new branches opened in the last quarter of 2010 start full operations.
The new branches are located in Alabang, Muntinlupa; Global City, Taguig; Malabon; and Bacoor and Dasmarinas in Cavite.
Rubio pointed out that these areas play host to large residential communities and small to mid-sized businesses that offer huge markets for retail deposits, and middle market and consumer loans.
UCPB plans to open at least five more branches this year to sustain deposit and loan growth.
Last year, UCPB recorded a net income of P2.39 billion, expanding 44 percent from the 2009 figure of P1.66 billion. Total assets reached P178.13 billion, up nine percent from P162.81 billion a year ago, and total capital of P14.30 billion, up 15 percent from P12.45 billion.
Loan portfolio expanded 16 percent to P54.77 billion, while trading and investment securities 14 percent to P50.07 billion.
The volume expansion, along with the 11-percent improvement in margins, boosted the bank’s interest income 15 percent to P7.83 billion.
Non-interest income went up 32 percent to P2.22 billion, bolstered by substantial increase in trading gains.
Deposits grew 16 percent to P148.57 billion. With two-thirds of the deposit growth coming in the form of low-cost current account and savings account, the bank was able to cut its interest expense.
Last year, UCPB renovated 60 of its branches, increasing market visibility and enhancing customer experience; relocated 18 others to more accessible locations with bigger markets; and opened five new ones, extending market presence to 183 locations.