Union Bank of the Philippines demonstrated robust financial performance in the first quarter of 2025, generating ₱19.4 billion in revenues, marking a significant 8.4% year-on-year increase. This impressive topline growth was fueled by a thriving consumer business, an expanding net interest margin, and escalating fee-based revenues.
Notably, UnionBank’s strategic focus on consumer lending has resulted in this segment now comprising 62% of its total loan portfolio, nearly three times the industry average. This strong performance is underpinned by a diversified consumer loan strategy, with credit cards, personal loans, and teachers’ loans experiencing the most rapid expansion. The bank’s extensive retail client base, currently at 17.6 million, provides a solid and promising foundation for sustained growth in the periods ahead.
The bank’s net interest margin saw a healthy improvement of 69 basis points, reaching 6.3%. This expansion was driven by the higher yields from its consumer loan portfolio, coupled with reduced funding costs. The latter was positively impacted by the continuous growth of UnionBank’s low-cost deposits and the prevailing easing monetary conditions. Furthermore, fee-based income surged by 21.3% to ₱3.7 billion, a direct result of the larger customer base driving increased transaction volumes. Consequently, the fees-to-assets ratio rose to 1.3% from the previous 1.1%, positioning it as one of the highest in the industry.
This strong revenue generation provided UnionBank with the capacity to absorb the impact of one-time, tax-related write-offs from a subsidiary and front-loaded non-recurring costs. Consequently, the reported net income for the first quarter stood at ₱1.4 billion year-on-year.
According to Manuel R. Lozano, Chief Financial Officer, “The fundamental drivers of our financial performance remain strong. We are consistently acquiring a substantial number of new clients each month, alongside the expansion of our net interest margin and fee-based income. These trends indicate the sustainability of our strong revenue performance. Moreover, adjusting for the impact of these one-off items, our net income would be comparable to previous quarters. Looking forward, we anticipate a return to this performance trajectory and remain confident in exceeding our 2024 results.”
