UCPB earned P2.91 billion as of September 30, 2018, a 4% decrease from P3.031 billion for the same period last year, as rising interest rates during the period affected the Bank’s net interest margins as well as limited trading opportunities in fixed income securities.
Total interest income grew nearly 10% to P11.44 billion from P10.47 billion a year ago but higher cost of funds curbed the increase in net interest income to only 4%, from P8.31 billion to P8.62 billion.
Loans, mainly coming from the consumer sector, fueled the continued rise of the Bank’s interest earnings with the total portfolio expanding by P17.22 billion or 11% to P178.48 billion from P161.26 billion.
Non-interest income is reported at P1.82 billion, slightly lower than the previous P1.86 billion, as higher revenues from service charges, fees, bancassurance commissions and foreign exchange in the first nine months of the year could not fully offset the contraction of trading and securities gain.
UCPB President and CEO Higinio O. Macadaeg, Jr. said that with the challenging environment likely to persist through the last quarter of the year, “we will focus on businesses where we are particularly strong such as consumer lending, especially the real estate segment, and bancassurance, which stand to grow with the continued expansion of the Bank’s consumer loan portfolio.” Mr. Macadaeg said the Bank will also take up more provisions towards the end of the year, a conservative move to cover the Bank’s growing loan portfolio.
Bancassurance, which UCPB is doing in partnership with United Coconut Planters Life Assurance Corp. (COCOLIFE) and UCPB General Insurance Company (UCPB GEN), significantly increased year on year, contributing to the Bank’s earnings in the first nine months of the year.
Date published: November 23, 2018