MANILA, Philippines — Rebisco-led Asia United Bank (AUB) incurred a 36 percent drop in net income to P1.9 billion in the first half, from P2.4 billion in the same period last year, on the back of lower trading and securities gains amid the COVID-19 pandemic.
AUB president Manuel Gomez said the bank remains cautious about the impact of the more contagious Delta variant on the ability of the country to recover faster from the pandemic-induced recession.
“We expect 2021 to be a better year than 2020 due to the vaccine rollouts by the government and the private sector that will help improve consumer confidence and lead to increased economic activity. However, we remain cautious and vigilant about the COVID-19 variants and the economic impact of the ongoing pandemic. We are not letting our guard down,” Gomez said.
The lower earnings translated to a lower return on equity of 11 percent and return on assets of 1.2 percent.
Bucking the overall weakness in loan appetite due to sluggish consumer and commercial business activities, AUB was able to keep its net interest income steady at P5.4 billion.
The bank also managed to trim its operating expenses by three percent to P2.7 billion from January to June, resulting in a better cost-to-income ratio of 45.1 percent versus the industry’s 53.8 percent.
AUB said growing customer acceptance of its digital channels also helped trim its operating cost as well as increase efficiency and productivity. It has a network of 270 branches nationwide, including 48 branches of its four subsidiaries.
Furthermore, the Rebisco-led bank was able to slash its provision for potential loan losses by 41 percent to P896 million in the first semester from P1.5 billion in the same period last year.
The bank’s deposit base jumped by 22 percent to P282 billion from January to June this year, boosting its total assets by 16 percent to P336 billion in end-June.