AUB income may hit P850M this year
December 12, 2006 | 12:00am
The Asian United Bank (AUB) has reported a net income of P690 million in the first 10 months of 2006, or 17 percent better than the same period last year.
Original full year 2006 income target was placed at P750 million but bank officials forecast the same to end closer to P800 to P850 million. Net income realized last year was P696 million, and P457 million in 2004.
The key drivers was strong gains from treasury, loans, branch income and remittances. Income from treasury accounted for roughly 50 percent of income, followed by loans and earnings from branches (roughly 20 percent each), and a single digit contribution from remittance business.
Initially, AUB is targeting net income at a "conservative" P700 million in 2007.
"All businesses will make positive contributions with treasury experiencing slower growth due to lower interest rates," Rustico C. Nazareno Jr., AUB senior vice president, added.
Business from remittances is expected to increase its contribution to the bottom line from a little over five percent of earnings, to almost 10 percent.
Optimisim is based on the national average of 20 percent annual growth rate in remittances, plus new domestic and foreign alliances forged by the bank.
Meanwhile, the peso is forecast to end the year at the 49 to 49.50 range to the dollar, according to a leading treasury manager.
"We do not see any sudden changes in the peso’s value," said Antonio V. Agcaoili, senior vice president and treasurer of the Asian United Bank (AUB). "And the peso will likely remain in that range at least for the first half of 2007."
The Bangko Sentral ng Pilipinas (BSP) places the range to between 50 to 52, for the end of 2006, and likely strengthen to a range 49 to 51 to the dollar.
The peso will be supported by higher remittances from overseas Filipino workers (OFWs) and migrant Filipinos, a weak US economy and dollar, and low interest rates.
"We do not see the US Federal Reserve (US Fed) moving away from the present levels of five to 5.5 percent," Agcaoili said, adding that the BSP will likely keep its interest rates at bay.
However, bank treasury managers believe that the peso can not strengthen any further as it will suppress consumer spending especially from the beneficiaries of the OFWs and MFs.
The property sector is surging forward mainly from remittance money, and the allied industries directly benefit. "Higher interest rates will only work against growth."
A stronger peso meanwhile allows corporates and large businesses to pay off its foreign-sourced debts, and the same falls true for the National Government.– Ted Torres
Original full year 2006 income target was placed at P750 million but bank officials forecast the same to end closer to P800 to P850 million. Net income realized last year was P696 million, and P457 million in 2004.
The key drivers was strong gains from treasury, loans, branch income and remittances. Income from treasury accounted for roughly 50 percent of income, followed by loans and earnings from branches (roughly 20 percent each), and a single digit contribution from remittance business.
Initially, AUB is targeting net income at a "conservative" P700 million in 2007.
"All businesses will make positive contributions with treasury experiencing slower growth due to lower interest rates," Rustico C. Nazareno Jr., AUB senior vice president, added.
Business from remittances is expected to increase its contribution to the bottom line from a little over five percent of earnings, to almost 10 percent.
Optimisim is based on the national average of 20 percent annual growth rate in remittances, plus new domestic and foreign alliances forged by the bank.
Meanwhile, the peso is forecast to end the year at the 49 to 49.50 range to the dollar, according to a leading treasury manager.
"We do not see any sudden changes in the peso’s value," said Antonio V. Agcaoili, senior vice president and treasurer of the Asian United Bank (AUB). "And the peso will likely remain in that range at least for the first half of 2007."
The Bangko Sentral ng Pilipinas (BSP) places the range to between 50 to 52, for the end of 2006, and likely strengthen to a range 49 to 51 to the dollar.
The peso will be supported by higher remittances from overseas Filipino workers (OFWs) and migrant Filipinos, a weak US economy and dollar, and low interest rates.
"We do not see the US Federal Reserve (US Fed) moving away from the present levels of five to 5.5 percent," Agcaoili said, adding that the BSP will likely keep its interest rates at bay.
However, bank treasury managers believe that the peso can not strengthen any further as it will suppress consumer spending especially from the beneficiaries of the OFWs and MFs.
The property sector is surging forward mainly from remittance money, and the allied industries directly benefit. "Higher interest rates will only work against growth."
A stronger peso meanwhile allows corporates and large businesses to pay off its foreign-sourced debts, and the same falls true for the National Government.– Ted Torres
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