PSE Circular for Brokers No. 2569-98

November 11, 1998 PSE CIRCULAR FOR BROKERS NO. 2569-98 November 10, 1998 PHILIPPINE STOCK EXCHANGE Tektite Tower, Ortigas Center Pasig, City Attention: Mr . Reynold Ong/VP Listing and Disclosure Group Gentlemen : We are sending herewith copy Notice for publication in connection with Union Bank profits hit P1 billion for first 3 quarters. For your information and guidance. Thank you. Very truly yours, (SGD.) ATTY. FE B. MACALINO Corporate Secretary, First Vice President and General Counsel PRESS RELEASE 10 November 1998 UnionBank profits hit P1 billion for first 3 quarters UnionBank of the Philippines ended the first nine months with net earnings of P1.0 billion or a 13% growth from P902 million for the same period last year. During the same nine-month period, the Bank also set aside hefty provisions for probable loan losses amounting to P523.7 million, more than 3 times the amount provided for the same period last year. Victor B. Valdepeas, UnionBank president and chief operating officer, said the growth in income was broad-based, with interest, fees and commissions, and notably treasury income showing respectable gains. He added that the Bank will maintain a relatively conservative stance in its lending operations, putting more emphasis on managing its existing credit portfolio. However, he sees some modest growth in its credit portfolio in 1999, mainly in the consumer products and services industries as the Asian economies are beginning to stabilize. Cdphil "The outlook for the next 6 to 12 months if for a more stable foreign currency markets in the Philippines and in Asia and also for a lower level of interest rates vis-a-vis 1998. This will allow the corporate sector some breathing space from recover from the Asian crisis. The recovery period, however, will take at least 2 to 3 years in Asia as the damage has been deep and widespread. For the country recovery period will be shorter," Valdepeas said. UnionBank's investments in technology, systems and training will continue at full speed. It has initiated a major re-engineering effort some four years back and is now in the final phase of implementation. This initiative has enabled the Bank to significantly improve its operating efficiency and productivity and at the same time provide its clients with wider and more efficient service delivery channels for its products and services. The Bank remains strongly capitalized at P9.6 billion, up 34% from year-ago. As of end-September 1998, UnionBank's tier I capital ratio stood at 23.4%, one of the highest capital adequacy ratios in the Philippine banking industry. UnionBank was named the lone Philippine bank among the world's 25 soundest banks based on capital-to-assets ratio. This was published in the July 1998 issue of The Banker, published by the Financial Times Ltd. of London, a global authority on banking industry information.