Aboitiz group to allot P60M for bank expansion in Luzon
Following a robust performance from its banking business last year, Aboitiz Group will invest at least P60 million for six new branches in Luzon this year.
Aboitiz Equity Ventures (AEV) will open at least six new branches of their City Savings Bank this year to cement their brand as a preferred lending institution for public school teachers, said Erramon I. Aboitiz, AEV president and chief executive officer.
He said that it would also strengthen the group’s UnionBank brand to cater to more retail customers.
“Union Bank will continue to strengthen our customer franchise focusing on enhancing the retail component of the business and establishing stronger sales management approach. We will invest in technology and rationalize branch network expansion in strategic areas to help us maximize growth channels for deposits and loan accounts,” said Aboitiz in an interview after the May 21 annual AEV Stockholders Meeting.
Aboitiz said the group is evaluating the performance of each branch.
UnionBank has 190 branches.
Aboitiz said that AEV officials have no plans to open new brances for Union Bank.
But he said they’re keen on expanding City Savings Bank.
With the six branches opened by year’s end, City Savings Bank should have a network of 40 branches strategically located in key areas in the country.
He said AEV plans to expand by setting up five to six bank branches every year.
Of the three businesses under AEV, including Aboitiz Power and the food group, only the banking segment ended the year with robust growth of 31 percent compared to 2010’s figures ending with a net earning contribution of P3.4 billion last year.
According to Aboitiz, the strong performance of the banking arm offsets the group’s fiscal losses in their power and food businesses.
Aboitiz said that as of the end of first quarter this year, the banking group already recorded a 215 percent increase over the same period last year with P1.3 billion by end of March.
“The banking group’s contribution for the first quarter is 23 percent of the whole AEV net income of P5.9 billion which is 27 percent higher than that of last year. Trading gains of UnionBank bolstered profitability of this business unit,” said Aboitiz.
