UCPB sees lower 2020 earnings

MANILA, Philippines — Government-controlled United Coconut Planters Bank (UCPB) expects its earnings to decline this year due to the impact of the COVID-19 pandemic.

Liduvino Geron, officer-in-charge at UCPB, said the health crisis has severely affected consumers, as well as businesses, prompting the bank to remain cautious despite its strong and sustained performance in the first quarter and in 2019.

“However, we also anticipate a decline in our net income by yearend given the negative impact of the pandemic to businesses and consumers alike. It’s a time riddled with challenges arising from the global health crisis, but we will work doubly hard to serve our clients, ensure the safety of our employees and help communities hard hit by COVID-19 as much as we can,” Geron said.

The net income of UCPB surged by 83 percent to P1.3 billion in the first quarter from P715 million in the same period last year amid robust efforts to expand consumer and commercial lending, as well as an increase in trading and securities gain.

The bank’s interest income increased  by eight percent to P293 million due to a higher gross loan level, translating to a 32 percent jump in net interest income to P3.2 billion.

Likewise, non-interest income surged by 86 percent, mainly driven by trading and securities gain and service charges.

The bank’s loan book inched up by 1.5 percent to P165.9 billion from January to March, while its deposit base went up by seven percent to P278.8 billion.

For 2019, the bank’s earnings went up by 18 percent to P4.18 billion from P3.5 billion in 2018, driven by net interest income growth of 7.2 percent, lower funding costs and higher trading gains.

“The bank has done exceptionally well with its double-digit growth in 2019 and the first quarter of the year,” Geron said.

In response to the call for relief measures in the ongoing COVID-19 crisis, UCPB has undertaken various measures to support its clients, stakeholders and employees.

The bank prudently increased its provisions for losses as a result of its initial assessment of the credit portfolio, owing to the impact brought about by the pandemic on local businesses and consumer borrowers and the uncertain global and local economic outlook.

It also provided a grace period for loan clients in line with the Bayanihan To Heal As One Act, and also waived InstaPay and PESONet fees for individual clients.