Despite declining net income in the first nine months, Asia United Bank (AUB) remains optimistic that it will hit its revenue target this year.
The listed lender said in a statement over the weekend that its four subsidiaries had a consolidated net profit of 2.9 billion pesos in January-September 2021, 23.68% lower than a year ago.
He pointed out that while income from trading and securities fell by 2.4 billion pesos, this was somewhat offset by a 1.6 billion peso drop in the provision for losses.
AUB said its total assets rose 9% to 317 billion pesos at the end of September, from 291 billion pesos the year before. During the period, total loans remained unchanged at 165 billion pesos, while total deposits increased 13% to 262 billion pesos.
Overall appetite for loans remained weak in the third quarter as the banking sector and customers remained cautious, according to the bank.
After building a sizable reserve last year to deal with the credit risk caused by the pandemic, AUB said it was able to cut operating expenses by 25% to $ 5.5 billion of pesos during the period due to a decrease in the allowance for loan losses.
Despite this, the lender said it aims to meet its consolidated net income target of 4 billion pesos this year, as its core business benefits from improved business and consumer confidence. This is 30 percent more than the group’s net profit of PPA 3 billion in 2020.
“We predicted 2021 to be a better year and we are on track with our goals so far. The easing of lockdown restrictions, continued government roll-out of vaccines and improved business climate are expected. all bode well for the bank’s commercial and consumer credit businesses, ”AUB President Manuel Gomez said in a statement.
“We expect credit quality to continue to improve as the economy opens up, so our allowance for loan losses should be sufficient for the year. We are also seeing better business opportunities and stable operating expenses as the monetary policy stance remains accommodative to support the full recovery of the economy, “he added.