Q3 2025 Union Bank of the Philippines Earnings Call Transcript
Key Points
- Union Bank Of The Philippines Inc (PHS:UBP) reported a significant increase in net income, reaching PHP6.5 billion for the first nine months of 2025, with a 77% improvement quarter-on-quarter.
- The bank's customer base expanded by 1.8 million year-on-year, totaling over 18 million individual customers, including 283,000 new credit card clients.
- Net interest margins improved by 51 basis points year-on-year, supported by growth in low-cost CASA deposits and lower policy rates.
- Union Bank Of The Philippines Inc (PHS:UBP) achieved a net revenue-to-assets ratio of 7%, driven by increased transactions from credit cards, InstaPay, and other banking services.
- The bank's capital adequacy ratios remain strong, positioning it well for future business expansion and improved shareholder returns.
- Non-interest income declined year-on-year due to lower trading gains, with swap losses impacting the bank's funding strategy.
- Total expenses grew by 7%, attributed to investments in customer acquisition, service delivery, and operational efficiency.
- The bank's cost-to-income ratio stands at 59%, with Union Digital still operating at a net loss, impacting overall profitability.
- Institutional loans declined by 2% as the bank prioritized higher-margin consumer products, leading to flat overall loan growth.
- Union Digital's loan portfolio contracted significantly, reflecting a focus on lower-risk segments and impacting overall growth.
Good afternoon. Welcome to Union Bank's earnings results briefing for the first nine months of 2025. My name is Jackie De Jesus, and I will be the moderator for today's call. (Operator Instructions) And lastly, this briefing will be recorded. By joining this session, you consent to your name, voice, image, and chat comments being recorded for use and dissemination.
For today's call, Dominic Banal, the Trading Head for Global Markets, will kick us off with Union Bank's macroeconomic and industry outlook. After him, Union Bank CFO, Dmi Lozano, will present the bank's financial performance. With that, let me turn you over to Dominic.
Thank you, Jackie, and good afternoon, everyone. So the FOMC cut rates in its October meeting has had been widely anticipated by the market in the lead-up. However, Fed Chair Powell cautioned the market in pricing in a cut in the December meeting, calling it, and I quote, not a foregone conclusion, far from it.
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