UnionBank allots P3 B for capex

Aboitiz-led Union Bank of the Philippines is spending P3 billion for capital expenditure this year amid the continued implementation of its digital transformation strategy.

Edwin Bautista, president and chief executive officer of UnionBank, said in an interview with The STAR the amount was P1 billion higher than the P2 billion spent last year.

The bulk of the funds, he explained, would bankroll information technology projects particularly for cybersecurity as well as the renovation of existing bank branches that is part of the digital transformation.

Bautista said UnionBank is looking at rolling out five more fully digital branches through The ARK in key cities nationwide including BGC in Taguig, Cebu, Davao, among others.

According to Bautista, the bank is also studying the possibility of establishing 10 to 15 lighter version of The ARK branches nationwide.

The ARK provides an interactive experience for all its clients, as they have created a space where digital technology is used. Simply put, The ARK is a new digital platform experience in banking, a concept branch that provides unparalleled service for all clients.

The first ARK branch was established at the ground floor of the Insular Life Building located at the corner of Ayala and Paseo de Roxas avenues in Makati City.

UnionBank has successfully raised half of its $1 billion euro medium-term note program and has also has a pending long term negotiable certificates of deposits (LTNCDs) issuance where it intends to raise as much as P20 billion.

The country’s 9th largest bank in terms of assets continued to grow its core profit on the back of its robust loan portfolio.

Bautista said UnionBank’s core income excluding revenue from one-off transactions as well as trading activities likely jumped 30 percent last year.

The earnings of the listed bank fell 21 percent to P6.39 billion in the first nine months of 2017 from P8.14 billion in the same period last year due to lower gains from the sale of trading and non-trading financial assets as well as higher expenses.