On the heels of a long-term plan toward 2020, Aboitiz-led Union Bank of the Philippines (UnionBank) is expanding its branch network by 10 percent each year in urban integrated developments across the country.
“In general, we have this rough guideline that we expand by 10 percent. Right now, if we have 253, we would be targeting something like 25 branches. That is the rough guideline. It is not a straight line projection, because there are many factors… But roughly, that will be our guidance every year,” President and COO Victor Valdepeñas, said on Friday.
This is in line with the objective and long-term strategy, called FOCUS 2020, which aims to grow UnionBank as the third largest Philippine bank by 2020 from its current rank as 7th largest bank in terms of assets.
“Not only the regulatory approval from the BSP [Bangko Sentral ng Pilipinas], but equally important are the premises those areas that we want to move into. Part of our game plan is to focus us physically in the fast developing new areas like Fort Bonifacio, Mall of Asia, also in Cebu,” Valdepeñas said.
“UnionBank is beginning to be more situated or located on those areas, because those are where our customers are. We want to be very close to our customers, because it’s very convenient for them. It will be a very important factor moving ahead because, when the degree of traffic becomes much harder to move around, it will be more convenient to customers for us to be easily accessible,” he added.
As of end-2014, UnionBank has a network of 253 branches 179 UnionBank and 74 City Savings Bank and 238 automated teller machines nationwide.
In the next six months, Valdepeñas said, the bank will open 15 to 20 branches, mostly in urban large-scale developments.
The bank has programmed P1 billion in spending to hit its profit guidance of P8.7 billion in net income for the 2015, compared with P8.4 billion a year ago, which Union Bank said will come mostly from consumer loans.
A fourth of the net income target will come from subsidiary City Savings, which is expected to make between P2.8 billion and P3 billion from P1.8 billion.
Valdepeñas, 68, is stepping down as president and COO by year-end. He has served as UnionBank president for 19 years, the longest in the industry. He will be replaced by Eugene Bautista.
In the quarter of 2015, UnionBank’s net income fell to P1.48 billion from P2.4 billion in the same period last year due to a steep drop in trading gains to P540 million from P1.07 billion.
UnionBank is the banking arm of Aboitiz Equity Ventures Inc., the holding firm of the Aboitiz family. The holding also has interests in power distribution, generation and retail electricity supply (Aboitiz Power Corp.); food manufacturing (Pilmico Foods Corp.); and real estate (Aboitiz Land Inc.).