UnionBank 1H2023 Net Income at P6.4 billion

Union Bank of the Philippines delivered a net income of P6.4 billion in the first six months of 2023, up by
6% against the same period last year.

Net revenues for the first half of the year amounted to P34.4 billion, increasing by 60% versus the same
period last year.

Net Interest income grew 41% to P24.0 billion, largely attributable to the 43% increase in the Bank’s loan
portfolio plus better net interest margin. Net interest margin increased by 60 bps to 5.2%. The Bank’s
strong focus on high- yielding consumer loans more than offsets the impact of the rising cost of funds. The
Bank’s proportion of consumer loans to total loans improved to 55% this year versus 42% last year.
Fees and other income more than doubled to P10.5 billion, primarily due to card-related transactions,
digital transactions, and the growing base of the Bank’s key subsidiaries.

Operating expenses were up by 82% to P21.8 billion on account of one-time integration cost of the
acquired Citi consumer business and the establishment of UnionDigital. Excluding the planned costs
attributed to these new business segments, the increase in operating expenses was in line with volume
growth.

Total assets as of June 2023 amounted to P1.1 trillion, up by 27% from June 2022. Net loans and
receivables climbed up by 43% to P522.2 billion, while total deposits increased by 25% to P693.3 billion.
“We consider this year as a period of investing for our future. Our costs will temporarily be elevated this
year, while the integration of the acquired Citi consumer business is ongoing. Having said this, we have a
healthy earning asset base. We have a well-diversified consumer loan mix and all segments are growing
in double digits. As soon as we complete the Citi integration, we expect a substantial reduction in
operating expenses that will bring us back to above-industry ROE we have been known to deliver,” said
Manuel R. Lozano, Executive Vice President and Chief Financial Officer.

“All our consumer business-engines are running in full speed. We now have over 12 million customers. The
acquired Citi business is contributing around one-third of our income today. CitySavings continues to be a
market leader in providing salary loans. UnionDigital is already profitable and growing fast. This kind of
momentum gives me confidence that UnionBank will achieve its goal of becoming the largest and most
profitable retail bank in the Philippines by 2025.” said Edwin R. Bautista, President and Chief Executive
Officer.