Union Bank of the Philippines (UnionBank) has strengthened the capability of its digital banking arm UnionDigital Bank Inc. through a P400-million capital infusion.

In a report to the Philippine Stock Exchange, UnionBank reported the additional capital to UnionDigital represented some of the P9.92 billion in net proceeds from the former’s stock rights offering (SRO) for 327,118,089 common shares.

These were listed on the Philippine Stock Exchange on 31 May 2024.

UnionBank allocated P679.5 million to its own consumer loan business and the remaining P8.8 billion to transactions with the Bangko Sentral ng Pilipinas.

“The net proceeds of the SRO are intended for capital infusion to UnionDigital and to fund UnionBank’s consumer asset growth,” UnionBank said.

Consumer loans raised

UnionBank allocated P679.5 million to its own consumer loan business and the remaining P8.8 billion to transactions with the Bangko Sentral ng Pilipinas.

Last year, UnionBank’s consolidated consumer loans expanded to 58 percent of the total loan portfolio. This included mortgage loans, personal or salary loans and auto loans.

Meanwhile, operating costs jumped by 43 percent to P45 billion as UnionBank enhanced systems of UnionDigital and integrated Citi cardholders into the former’s system.