The Aboitiz-controlled Union Bank of the Philippines declared a cash dividend totaling some P718 million, or equivalent to P1.12 per share, the bank said in a disclosure to the stock exchange yesterday.

UnionBank said the dividend would be payable from bank?s retained earnings as of Dec. 31, 2008. It said the board of directors approved the declaration of cash dividend in a meeting on Feb. 27.

UnionBank said it would set the record and payment dates once it obtained approval from the Bangko Sentral and clearance from the Philippine Stock Exchange.

UnionBank has not officially announced its net income for 2008. Profit in the first three quarters of 2008 fell 34 percent year-on-year as trading income dropped.

The trading income has been a major contributor to UnionBank?s income. With the dramatic fall in asset prices following the collapse of Lehman Brothers, several banks, including UnionBank, took advantage of the central bank?s move to allow them to shift assets from one class to another.

UnionBank shifted $314.97 million of financial assets in its books from the available for sale securities account to held for trading to avoid a paper loss of $20.44 million.

Banks were allowed to move assets to the held to maturity account, or as unquoted debt securities classified as loans, instead of keeping them as available for sale securities, or those for trading. Securities shifted to the held to maturity account will be valued in the books based on July 1 market prices, or prior to the Lehman Brothers collapse. Those kept in the available for sale securities or as held for trading will be marked to market, or booked based on current market prices. Eileen A. Mencias