United Bank for Africa Plc (“UBA”
or “the Bank”), announced its Audited 2016 Half Year Financial Results for the
period ended 30 June 2016 showing the bank recorded gross earnings of N166
billion, net operating income of N109 billion and profit before tax of N40
billion.
The bank also recorded a significant growth in total assets,
rising 20% to N3.3 trillion, crossing the three trillion mark. Following the
sterling performance, the bank’s Board recommended the payment of N0.20 interim
dividend on every ordinary share of N0.50 each.
Speaking on the results, Kennedy Uzoka, the GMD/CEO, UBA Plc said;
the results have been achieved amidst waning economic fundamentals.
“We delivered profit in excess of N40
billion and grew balance sheet by 20%, with our on-balance sheet total assets
crossing the N3
trillion mark. Even as Naira depreciation and inflationary pressure increased
the cost of doing business in Nigeria, we leveraged our economics of scale,
enhanced operational efficiency and Group shared service structure to moderate
our cost-to-income ratio by 90bps.”
UBA achieved several strong positives in its performance for the
half year. The bank’s net loan position rose 29% to N1.29 trillion partially
boosted by the depreciation in the value of the Naira. UBA also recorded a
significant 16% growth in deposits to N2.41 trillion already surpassing the 15%
target growth in deposits set at the beginning of the year. Another positive
for UBA was a drop in cost to income ratio to 63% as at half year compared to
64% in same period of 2015. It is noteworthy that the bank maintained its
strong asset quality, with non-performing loans ratio at 2.4%; well below the
CBN set limit of 5% for the banking industry.
Uzoka assured that; “UBA will sustain its culture of keeping a
healthy balance sheet, with strong liquidity and capitalization, as reflected
in the liquidity and BASEL II capital adequacy ratios of 45% and 18%
respectively.” He further stated; “notwithstanding the current slowdown in
economic activities, we see bright spots ahead, especially as we see strong
prospect to grow market share across all chosen economies, through our enhanced
dedication to customer service”.
Explaining the major drivers behind UBA’s strong performance, the
Group CFO, Ugo Nwaghodoh said; “This
impressive performance was driven by increased transaction volume, balance
sheet growth and efficiency as well as a disciplined management of operating
cost. We achieved a 60bps moderation in funding cost, despite the tighter
interest rate environment, as we continue to improve our deposit mix, towards
low cost savings and current accounts.”
Nwaghodoh said that UBA’s performance in the period endorses the
bank’s resilient ability to profitably grow its business from sustainable core
banking offerings.
“Notwithstanding the challenging macro and regulatory environment,
we achieved a 17.3% return on average equity in the period” even as the total
equity of the Bank grew 23% to N407 billion.
He explained that the bank’s African subsidiaries continue to
record significant milestones in their performance, as two erstwhile loss
making subsidiaries are now profitable and having positive contribution to the
bank’s bottom line.
“Overall, African subsidiaries, contributed a quarter of the
Group’s profit, with an even stronger outlook, as we deepen our penetration of
the respective markets, the Group CFO added.”
United Bank for Africa (UBA) Plc, is one of Africa's leading
banking Groups with operations in 19 African countries and offices in three
global financial centers: London, Paris and New York.
From a single country operation in Nigeria, Africa's largest
economy, UBA has evolved into a pan-African provider of banking and related
financial services, to more than 11 million customers, through over 1000
Business Offices and diverse channels globally.
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