UCPB income up 7% in H1

MANILA, Philippines - Earnings of United Coconut Planters Bank (UCPB) went up seven percent in the first half of the year due to the sustained growth in its consumer lending business, fee-based income and trading gains.

The bank’s net income reached P1.3 billion from January to June this year as the 28 percent jump in consumer loans wiped out the 13 percent drop in corporate and commercial loans.

UCPB president and CEO Jeronimo Kilayko said the bank is confident it would be able to sustain its growth momentum.

The bank’s total deposit levels rose more than six percent as check and savings accounts (CASA) levels went up 14 percent to P157 billion in end June this year.

This was enough to offset the 11 percent decline in time deposits to P50 billion.

Despite the three percent drop in net loans receivable, the bank’s net interest income still inched up two percent with loan interest income increasing by five percent due to the higher yields earned from its consumer loan portfolio.

Total non-interest income grew 3.2 percent to P1.2 billion on the back of the seven percent increase in both service fees and trading incomes.

Meanwhile, the bank’s operating expenses remained relatively flat with a slight two percent increase even with the 10 percent rise in manpower cost with improvements in employee compensation and benefits as well as an increase in consumer business related head count.

Net non-performing loans remained below three percent of gross loan portfolio on the strength of improved credit quality processes and risk management particularly in the consumer lending business.

In July, the government has put on hold the sale of its controlling stake in UCPB worth about P15 billion after the Supreme Court issued a temporary restraining order (TRO).

The high tribunal stopped the implementation of EO 179 and 189 issued by President Aquino on the controversial coco levy fund including the government’s 73.9 percent stake in UCPB.

Kilayko said UCPB is confident the bank’s recapitalization would resume in due time to further boost the bank’s continued growth.

Groups that have expressed interest in UCPB include Mitsubishi UFJ, BDO Unibank Inc., China Banking Corp., East West Banking Corp., and Robinsons’ Bank.

In 2014, UCPB ranked 12th in the banking industry, with a combined network of 228 branches and 328 ATMs. It also controls UCPB Savings Bank.