Union Bank Of The Philippines · PSE:UBP

Union Bank Of The Philippines — Q1 2025 Earnings Presentation

25 slides from Union Bank Of The Philippines's earnings presentation, May 13, 2025

  1. Slide 1: UnionBank Company Presentation

    UnionBank Company Presentation May 13, 2025 Strictly Private & Confidential

  2. Slide 2: Company Disclaimer

    Strictly private and confidential Company Disclaimer You must read the following before continuing. The following applies to the information following this page, the oral presentation of such information at the meeting you are attending, the Q&A session and other materials which may be distributed a

  3. Slide 3: Market Updates and Outlook

    Strictly private and confidential Market Updates and Outlook 3

  4. Slide 4: Post-trade-war policy expectations consolidating at 2-3 cuts

    Post-trade-war policy expectations consolidating at 2-3 cuts • Volatile markets in the past month on Trump trade war price action • US treasuries initially benefitting from economic slowdown projections • Sell-off morphed into sell-US on increasing isolationist policies • Market recovering gradually

  5. Slide 5: Market Expecting 3 cuts vs. Fed Dots at 2

    Strictly private and confidential Market Expecting 3 cuts vs. Fed Dots at 2 Futures implied Dots 5

  6. Slide 6: As much as 4 cuts priced in at one point; Still expecting 1-3 cuts

    Strictly private and confidential As much as 4 cuts priced in at one point; Still expecting 1-3 cuts 6 6

  7. Slide 7: Curve steeper on sell-US trade

    Strictly private and confidential Curve steeper on sell-US trade 7

  8. Slide 8: USD RoPs offer decent pickup against O/N and UST curve

    Strictly private and confidential USD RoPs offer decent pickup against O/N and UST curve 8

  9. Slide 9: BSP cuts policy rate to 5.5%, signals more cuts throughout the year

    BSP cuts policy rate to 5.5%, signals more cuts throughout the year • The BSP will likely cut its key rates “a few more times” this year says BSP Governor Remolona, he was quoted: • “Our forward guidance says that we’ve become somewhat more dovish now than a week ago” • “The key policy rate at the m

  10. Slide 10: GS curve steeper for the year on jumbo issuance

    GS curve steeper for the year on jumbo issuance

  11. Slide 11: Headline CPI slid to 1.4% in April

    Headline CPI slid to 1.4% in April 2.2 2.4% 2.1% 1.4

  12. Slide 12: USD/PHP breaks lower on weaker Dollar

    USD/PHP breaks lower on weaker Dollar

  13. Slide 13: 1Q-25 Financial Performance

    Strictly private and confidential 1Q-25 Financial Performance 13

  14. Slide 14: Strong topline performance and underlying drivers

    Strictly private and confidential Strong topline performance and underlying drivers Customer Growth Net Interest Margin (in #, Mn) 17.3 17.6 6.3% 16.2 6.0% 5.5% 5.7% 13.9 4.8% 69 4.5% 4.6% 11.8 8.4% bps 4.3% Industry* 8.9 7.1 2020 2021 2022 2023 2024 1Q24 1Q25 2020 2021 2022 2023 2024 1Q24 1Q25 Net

  15. Slide 15: UnionBank 1Q25 net income at P1.4Bn

    Strictly private and confidential UnionBank 1Q25 net income at P1.4Bn UnionBank’s retail strategy continues to pay dividends, as seen in the momentum of the bank’s topline performance Net income is down 29% YoY, mainly due to a one-time, tax-related write-off in UnionDigital and front-loaded costs.

  16. Slide 16: Net interest income up 14% mainly driven by wider margins

    Strictly private and confidential Net interest income up 14% mainly driven by wider margins Net Interest Income Net Interest Margin (in PHP, Bn) YoY Cost NIM Yield 0.3% QoQ 8.6% 8.6% 8.5% 8.5% 8.6% 7bps 14% YoY 15.1 15.4 15.4 15.4 14.0 5.7% 5.7% 5.9% 6.0% 6.3% 69bps 13.4 13.4 2.8% 2.8% 2.8% 2.6% 2.2

  17. Slide 17: Loan mix continues shift toward consumer

    Strictly private and confidential Loan mix continues shift toward consumer Gross Loans, OSB Loan Mix (in PHP, Bn) Industry’s Consumer Loans ~ 21% YoY Based on Q4-24 BSP Data Institutional Retail (Parent) CSB, UD, Other Subs 524 519 528 527 521 1% Cards, 34% Mortgages, 21% 117 119 118 120 Institution

  18. Slide 18: Steady growth in CASA

    Strictly private and confidential Steady growth in CASA Total Deposits (Consolidated), OSB CASA Deposits (Consolidated), OSB (in PHP, Bn) (in PHP, Bn) CASA High-Cost YoY CASA CASA to Deposit 692 684 1% 666 676 653 700 66% 66% 70% 64% 64% 62% 600 60% 261 229 230 12% 238 233 5% YoY 500 2% QoQ 50% 447

  19. Slide 19: Parent bank customer transactions driving fee income

    Strictly private and confidential Parent bank customer transactions driving fee income Non-Interest Income YTD Fees & Others (in PHP, Bn) (in PHP, Bn) Fees & Others Trading Income 1Q24 1Q25 YoY Recurring fees posted strong growth YoY 7.5 Parent Customer 72%, 3.1 93%, 3.6 6.5 6.0 Transactions 5.5 32%

  20. Slide 20: OPEX growth driven by volume and continued infrastructure investments

    Strictly private and confidential OPEX growth driven by volume and continued infrastructure investments Operating Expense Cost-to-income Ratio (in PHP, Bn) Core OPEX One-offs Core Cost-to-Income One-offs YoY 62% 3% QoQ 59% 59% 59% 57% 7% 4% 2% 1% 11.5 11.5 11.5 4% 2% 11.1 11.2 11.1 10.5 - - 0.3 0.3

  21. Slide 21: Credit cost higher but expected to normalize

    Strictly private and confidential Credit cost higher but expected to normalize Credit Cost Loan Mix Industry’s Consumer Loans ~ 21% Based on Q4-24 BSP Data Parent Others Parent Consumer CSB & Other Subs UnionDigital 86bps 4.6% 0.3% 3.7% 0.5% Cards, 34% 3.3% 1.0% 0.3% 0.3% Mortgages, 21% 0.2% Institu

  22. Slide 22: NPL-related ratios improving

    Strictly private and confidential NPL-related ratios improving NPL Ratio NPL Ratio (Consumer) UBP Industry UBP Industry 7.1% 7.4% 7.2% 7.2% 5.3% 6.9% 8.6% 8.7% 8.3% 8.1% 7.4% 2bps vs Q4-24 5.8% 5.8% 5.7% Industry 5.4% Parent Consumer 3.6% 3.8% 3.8% 3.5% NPL Ratio 1Q24 2Q24 3Q24 4Q24 1Q25 1Q24 2Q24 3

  23. Slide 23: Sufficient capital ratios to support growth

    Strictly private and confidential Sufficient capital ratios to support growth Capital Adequacy Ratio Group (CAR) Common Equity Tier 1 Capital Ratio Group (CET1) Common Equity Tier 1 Capital Ratio Parent (CET1) 16.8% 17.3% 16.6% 15.2% 15.6% 15.1% 15.6% 15.5% 14.8% 14.9% 14.7% 14.6% 14.2% 13.4% 12.4%

  24. Slide 24: Key takeaways and outlook

    Strictly private and confidential Key takeaways and outlook Key takeaways Outlook In 1Q 2025, net revenues were Php 19.4Bn Topline momentum is expected to continue on the back (+8.4% YoY) supported by solid performance 1 drivers such as our growing client base and 1 of positive trends in underlying

  25. Slide 25: Thank You!

    Strictly private and confidential Thank You! For comments and queries, contact us via: investorrelations@unionbankph.com Strictly Private & Confidential 25

Union Bank of the Philippines — Q1 2025 Earnings Presentation on 6ix