MANILA - Union Bank of the Philippines saw its net income drop to P11.6 billion last year versus P14 billion in 2019 on the back of higher "credit costs" or provisions for bad loans.
UnionBank on Monday said its credit costs swelled to P8.7 billion from P1.9 billion in 2019, as non-performing loans or "bad loans" increased to 5.1 percent from 3.1 percent, as businesses were disrupted by the COVID-19 pandemic.
UnionBank managed to book an "all-time high" revenues for 2020, reaching P42.1 billion compared to P38 billion a year ago on higher interest incomes and strong trading gains.
Net interest income grew 29 percent to P28.7 billion on the back of higher savings deposits, lower costs of funding due to low-interest rates, shift to high yielding loans, and strong trading gains valued at P8.9 billion.
“I am pleased with the Bank’s 2020 performance despite a challenging year...As we line up new features in our digital channels and Tech Up especially more of our underbanked and unbanked countrymen, we aim to ramp up digital customer engagement to sustain our momentum in 2021,” Edwin R. Bautista, UnionBank president and CEO, said.
UnionBank said it is eyeing to further grow digital transactions after it had 2 million customers transacting through their online channels in 2020, and over 500,000 new accounts were opened via its mobile app.