Union Bank auto and mortgage loan portfolio grows 50% in H1

MANILA, Philippines - Union Bank of the Philippines (UBP), the banking unit of the Aboitiz Group, said its auto and mortgage loan portfolio has expanded by 50 percent in the first half of 2011.

UBP executive vice president Edwin R. Bautista said the low interest rate environment, the strong peso and steady automobile prices have made acquiring a new automobile or a housing unit more affordable.

“In the past two years our retail or consumer lending segment of the business has been outgrowing the bank’s corporate segment,” Bautista said on the sidelines of the launching of the partnership between GXI Inc. and the bank. GXI, the commerce unit of Globe Telecom, manages the platform for the GCash e-money system.

The bank reported an 18-percent growth in consumer lending in the first three months of 2011. Mortgage loans grew 40 percent while auto loans, 35 percent.

UBP is listed at the Philippine Stock Exchange (PSE) and ranked among the leading commercial banks in the country.

Its loan portfolio in 2010 reached P95 billion while net income amounted to P5.4 billion.

Bautista admitted that the first three months was bad for most banks in terms of trading gains but the second quarter reflected improvements.

“All the banks have made adjustments which have resulted in improved returns in the second quarter,” the senior bank official said.

Meanwhile, Bautista said that the alliance with GXI for mobile banking services reflects the bank’s swift adapting to technology.

Mobile banking services is best suited for the expansion of retail banking an area of the bank’s client base which has been its focal point in the last few years.

“Our corporate banking activity has been the banks’ strength through the years hence we have been focusing on the middle and retail markets,” he added.

UBP has a branch network of 186 nationwide, but 120 are located in the Metro Manila area. It also operates 300 automated teller machines (ATMs) in 250 sites.