UnionBank experienced a shift in its financial landscape in 2025, reporting a 16.67% decrease in net income to P9.94 billion. This adjustment stemmed from strategic, one-time costs undertaken at the subsidiary level, a deliberate move to fortify the bank’s foundation for sustained future expansion.
Despite these costs, the core bank demonstrated remarkable resilience, fueled by the successful integration of a recently acquired consumer business. Record revenues generated by the parent bank played a crucial role in mitigating the impact of these expenses, showcasing a proactive approach to balance sheet strengthening.
A significant turnaround occurred in the latter half of the year, with earnings surging by an impressive 108% compared to the first six months. This momentum signals a positive trajectory, driven by a growing customer base and a strategic focus on key competitive advantages.
The bank’s total net revenues reached P83.2 billion, supported by a 9.7% increase in total customers, now exceeding 18.6 million. This expansion reflects a successful strategy of attracting and retaining a larger, more engaged clientele.
Net interest income saw a substantial rise of 10.72%, climbing to P64.25 billion, while interest expenses were notably reduced. This resulted in a net interest margin of 6.4%, a clear improvement over the previous year’s 6%.
While other income experienced a slight dip, fee income remained exceptionally strong, boasting a fee income-to-assets ratio more than double the industry average. This strength was propelled by increased digital transaction volumes – bills payments, funds transfers, and card-related fees.
Total operating income increased to P62.07 billion, demonstrating the bank’s ability to generate revenue despite navigating challenging economic conditions. Disciplined cost management, aided by digitization initiatives, kept overall cost growth to a manageable 5% when excluding one-time items.
Recognizing the importance of financial prudence, UnionBank increased its credit loss provisions to P21.16 billion, a proactive measure to safeguard against potential risks. This commitment to responsible lending is reflected in an improved nonperforming loan ratio, declining by 37 basis points to 6.8%.
The bank’s loan portfolio expanded to P537.68 billion, with unsecured consumer loans experiencing a robust 18% growth, driven by successful digital acquisition and cross-selling strategies. These loans now represent 61% of the total portfolio, demonstrating a diversified approach.
A notable increase in low-cost CASA deposits – current and savings accounts – by 12% further strengthened the bank’s funding base. This improvement in the funding mix contributed to margin expansion and reduced overall funding costs.
Total deposits grew by 15.4% to P267.019 billion, while total resources expanded to P1.16 trillion. These figures underscore the bank’s continued growth and its ability to attract and manage substantial financial assets.
UnionBank’s capital position remains robust, with total capital reaching P202.06 billion, well above regulatory requirements. Common equity Tier 1 and capital adequacy ratios stand at 15.03% and 15.86% respectively, providing a strong buffer for future growth.
Looking ahead, UnionBank is focused on disciplined growth, customer-centric innovation, and delivering long-term value to its shareholders. The bank is committed to building on its core strengths and capitalizing on emerging opportunities in the evolving financial landscape.
