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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