EXECUTIVES of Asia United Bank (AUB) expressed optimism it will meet its P4-billion consolidated net income target this year despite seeing its net income in the first nine months drop to P2.9 billion from P3.8 billion in the same period year ago.
Its gains from trading and securities were cut by P2.4 billion. The lender said this was partially offset by a P1.6-billion decline in provision for losses.
Its return on assets and return on equity slipped to 1.3 percent and 10.8 percent from last year’s 1.8 percent and 14.6 percent, respectively.
Total assets, however, climbed by 9 percent to P317 billion in the first nine months from P291 billion in the same period last year.
Loan portfolio was flat at P165 billion in January to September but total deposits rose by 13 percent to P262 billion during the same period.
“As both the banking industry and consumers remained cautious in the third quarter, overall loan appetite remained weak,” AUB said. This was supported by the 11-percent decline to P8 billion of the bank’s net interest income from loans and receivables as of end-September.
The lender based its optimism on the back of better business and consumer confidence.
The bottom-line projection is 30 percent more than its net income last year amounting to P3 billion, the listed bank said in a recent statement.
“We projected that 2021 will be a better year and we are on track with our targets, so far,” AUB President Manuel A. Gomez was quoted in the statement as saying. “The easing of lockdown restrictions, the continuous vaccine rollouts by the government and the improvement in the business climate should all bode well for the bank’s commercial and consumer lending businesses.”
The listed bank, meanwhile, saw a 25-percent cut in expenses during the period because of lower loan loss provision. This, after earmarking “significant buffer” for credit risk in the past year, it added.
“We anticipate credit quality to continue to improve as the economy opens up so our loan loss provision should be sufficient for the year,” Gomez said. “We also see better trading opportunities and stable operating expenses as the monetary policy stance remains accommodative to support the economy’s full recovery.”
