UnionBank income hits P1.4 billion in Q1

MANILA, Philippines — Union Bank of the Philippines posted a 30-percent drop in net income in the first quarter of 2025 as one-time expenses weighed on its bottom line, even as revenues continued to grow.

The Aboitiz-led bank reported a net income of P1.4 billion in the January to March period, down from P2 billion in the same period last year, as tax-related write-offs from a subsidiary and front-loaded non-recurring costs dragged earnings.

Despite the decline, UnionBank chief financial officer Manuel Lozano said the bank’s underlying operations remained strong, supported by continued client acquisition, margin expansion and growth in fee-based income.

“If we normalize for the impact of one-offs, our net income would be comparable to prior quarters,” he said.

UnionBank’s revenues rose by 8.4 percent year-on-year to P19.4 billion, powered by a growing consumer lending business, improving net interest margins and stronger fee generation.

Consumer loans accounted for 62 percent of the total loan portfolio, nearly three times higher than the industry average. The bank attributed the growth in consumer loans to strong demand for credit cards, personal loans and teachers’ loans.

UnionBank’s retail client base stood at 17.6 million as of end-March.

Net interest margin improved by 69 basis points to 6.3 percent on the back of higher-margin consumer loans and lower funding costs.

Furthermore, fee-based income jumped by 21.3 percent to P3.7 billion, lifting its fees-to-assets ratio to 1.3 percent, among the highest in the banking sector.

The bank said that the strong topline performance mitigated the impact of the one-time, tax-related write-offs from a subsidiary and front-loaded non-recurring costs.

“Moving forward, we expect performance to get back to this trajectory and remain confident that we will exceed our 2024 performance,” Lozano said.