Union Bank of the Philippines (UBP) projects loan growth averaging 15 percent this year, such expansion pushed faster by corporate, as well as consumer, lending.
Union Bank Chairman and chief executive officer (CEO) Justo Ortiz acknowledged margins, or the difference between what banks generate as interest earnings from loans and what they pay the depositors, are so low they just need to get better in what they do.
“I am fairly bullish but not on the trading side but on customer business. Loan growth would be 15 percent. There’s so much demand for loans, mostly corporates,” he said.
“The consumer loan is also growing; especially mortgage, credit cards and our teacher’s loans. It’s not exuberant but it’s good growth,” he added.
When asked about the bank’s planned acquisition of Export and Industry Bank, Ortiz replied: “There’s nothing new. I haven’t heard anything from the board.”
He said they are not keen on acquiring another bank this year, as margins are too low. “For me it’s not exciting,” he said.
He said UBP is well capitalized, thus no need to raise capital this year.
Union Bank issued P7.2 billion Tier-2 notes in November last year to strengthen its capital base and support its expanding lending and investment business.
The Tier-2 note carrier a coupon rate of 5.375 percent per annum and has a tenor of 10 years and three months, with a call option after five years and three months.