Union Bank H1 net profit drops on iBank purchase

Union Bank of the Philippines said on Tuesday its first-half net profit dropped due to expenses related to its purchase of International Exchange Bank and weaker income ad interest rates fell. In a statement, Union Bank said it had a first-half net profit of P1.1 billion versus P1.5 billion a year earlier. "The lower bottom line was attributed to the interim impact of expenses related to the purchase of International Exchange Bank (iBank). Weaker margins as domestic interest rates fell also accountedfor the decline in earnings," Union Bank said. Union Bank said it set aside P140 million for probable losses, bringing non-performing loans cover to 83 percent versus the industry's 78 percent. On June 5, 2006, Union Bank purchased 98.8 percent of iBank shares through a special block sale coursed through the Philippines Stock Exchange. The merger with iBank is expected to create the industry's seventh largest private universal bank with assets of approximately P170 billion and deposit base of close to P100 billion. - GMANews.TV