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  • UBA Earnings Hits N494bn, Records Significant Asset Growth, Driven by Market Share Gains Across Africa

    UBA Earnings Hits N494bn, Records Significant Asset Growth, Driven by Market Share Gains Across Africa

    …Records Profit of N106.8 billion

    The Pan-African financial institution, United Bank for Africa Plc has announced its Audited 2018 Financial Results with impressive growths achieved across major financial lines.

    According to the 2018 financials filed at the Nigerian Stock Exchange on Tuesday, the Africa’s global bank’s gross earnings grew by 7.0 percent to N494.0 billion, compared to N461.6 billion recorded in the corresponding period of 2017. The Bank’s total assets also grew significantly by 19.7 percent to an unprecedented N4.9 trillion for the year under review.

    These results, according to financial analysts largely demonstrates the benefits of the Group’s Pan-African footprints with continued growth in market share in key countries of operation across Africa. The contributions of ex-Nigeria subsidiaries at 40 percent, again confirms the strong footing of the Group’s franchise in Africa.

    Despite the challenging business environments in Nigeria and across key markets in Africa, the Bank’s Profit Before Tax was quite impressive at N106.8 billion, a 2.4 percent growth, compared to N104.2 billion in 2017 financial year. In same vein, the Profit After Tax rose by 1.4 percent to N78.6 billion, compared to N77.5 billion recorded in 2017. Due to lower foreign exchange trading income, Operating Expenses grew by 4.1 percent to N197.3 billion, compared to N189.7 billion in 2017

    Reflecting the modest appetite of the Bank in the year under review as well as impact of IFRS 9 implementation, net loans recorded a prudent 3.9 percent growth to N1.72 trillion while Customer Deposits increased by a remarkable 22.5 percent to N3.3 trillion, compared to N2.7 trillion recorded in the corresponding period of 2017, reflecting increased customer confidence and enhanced service channels. Furthermore, Shareholders’ Funds decreased marginally by 4.8 percent to N502.6 billion, reflecting the impact of International Financial Reporting Standards 9 (IFRS 9) implementation.

    Commenting on the result, the Group Managing Director/CEO, Kennedy Uzoka noted that the year 2018 was important for the Group, as it gained further market share in many countries of operation. More so, the CEO was excited at strategic achievements made in the year, including the start of wholesale banking operations in London, as it seeks to leverage the Group’s unique network across Africa. UBA also opened its 20th African operation.

    “Defying the relatively weak economic growth in Africa, earnings were positive and we grew our balance sheet by 20 percent, driven by the 23 percent growth in our deposit funding. In a period of economic uncertainty, we have focused on retail deposit mobilization, with exciting results. We recorded a 48 percent year-on-year growth in retail deposits and improved our CASA ratio to 77 percent, optimizing our funding mix, which will enhance our net interest margin (NIM), over the medium term,” Uzoka said.

    Uzoka remained confident that the Bank’s performance would be even stronger in the years ahead and shareholders would enjoy even greater dividends, as the Group is well positioned to take advantage of imminent fiscal reforms across many economies in Africa, a positive outlook which should stimulate new opportunities in infrastructure, manufacturing, agriculture and resource sectors.

    He continued: “Our operations in the United Kingdom now offer end-to-end trade, treasury, structured finance, wholesale deposit taking and ancillary services. With this development, we are better positioned to fulfill our aspiration of deepening trade and capital flows between Europe and Africa. We are also pleased with the market acceptance of our new operation in Mali”.

    “Having said this, I am excited by the profitability of our ex-Nigeria subsidiaries, which now contributes an impressive 40 percent earnings to the Group. At the moment, our Nigerian business is benefiting from our product and operational focus, gaining market share – most importantly, the increasing penetration of our retail offerings is reassuring, as this fundamental progress aligns with our strategy of focusing on sustainable growth”.

    “With great optimism, we look forward to a more rewarding 2019 for our shareholders, as we further sweat our resources and optimize productivity towards delivering superior returns,” he concluded.

    Also speaking on the performance, the Group CFO, Ugo Nwaghodoh said that the improving mix of the Bank’s funding base and asset pricing, reinforce a positive outlook on Net Interest Margin(NIM) and broader balance sheet efficiency.

    “Whilst considerable investment in people, digital transformation and channel enhancement masked cost efficiency gains within the year, with cost-to-income ratio at 64 percent, we are convinced that our diligent execution of new initiatives will ensure the reduction of Cost to Income Ratio(CIR) towards our medium-term target. Our balance sheet is being positioned to take full advantage of market swings and our strong 25 percent capital adequacy ratio provides headroom for growth, even under a BASEL III scenario. As it stands, UBA has started the year on a good note and should sustain the momentum, as we work towards improving our Return on Average Equity (RoAE),” Nwaghodoh said.

  • UBA Sustains Strong Performance with Growing Contribution and Market Share from Africa

    …Declares Profit Before Tax of N105.3 billion

    …Recommends N0.85 Total Final Dividend for the Year

    United Bank for Africa Plc has announced its audited results for the financial year ended December 31, 2017, showing significant growth in the contribution and market share from its pan-African subsidiaries, among other positive trends in the financial performance.

    The pan-African financial institution’s audited results showed that gross earnings grew substantially to N462 billion, up by 20 percent from N314 billion recorded in the corresponding period of 2017.

    According to the report released to the Nigerian Stock Exchange on Friday, the Group delivered a strong 16% year-on-year growth in profit before tax of N105 billion, compared to N90.6 billion in the 2016 financial year. The Profit After Tax also leaped to N78.6 billion, an 8.8% year-on-year growth compared to N72.3 billion in 2016.

    The Bank’s subsidiaries outside Nigeria contributed a third of the Group’s top-line and 45% of the profit for the year, a remarkable improvement from 31 percent contribution made by the ex-Nigeria offices in 2016. This, according to market analysts affirms the success of the Bank’s expansion strategy, with target of 50 percent contributions by 2020.

    The Bank’s Operating Income grew to N326.6 billion, a 20.6 percent increase compared to N270.9 billion recorded in 2016. This, according to analysts, affirms the capacity of the Group to deliver strong performance through varying economic cycles and challenging business environment.

    The audited results also showed that the Bank’s Total Assets peaked at N4.07 trillion, translating into 16.1 percent year-on-year growth from the figure of N3.50 trillion recorded as at 2016 financial year. In the 2017 financial year, the Bank’s Net loans achieved a prudent 9.7 percent growth at N1.65 trillion, while the customer deposits grew to N2.73 trillion, representing 10 percent YoY growth on N2.49 trillion recorded in 2016 financial year.

    Reflecting a strong internal capital generation, the Bank’s shareholders’ fund also soared 18.2 percent to N529.4 billion in the 2017 financial year.

    Subject to the approvals of the shareholders, the Board of UBA Plc proposed a final dividend of 65 kobo per every share of 50 kobo each. This final dividend proposal is in addition to the 20 kobo per share interim dividend paid after the audit of the 2017 half year financial statements, thus putting the total dividend for 2017 financial year at 85 kobo per share.

    Commenting on the result, Kennedy Uzoka, the GMD/CEO, said: “the results, underlines the success of our strategy of expanding across Africa, diversifying revenues and capturing the broader business opportunities inherent in Africa’s growth. The results reinforce the sustainability of our business model and the capacity to deliver superior long-term return to shareholders, as the economic and business environment improve.”

    “In 2017, we made strong progress in our strategic initiative of dominating transaction banking across all our countries of operation, gaining market share in all lines of our business. Even as the non-oil sectors of our largest country of operation, Nigeria, remained relatively weak, we still grew earnings by 20% to N462 billion, a third of which is attributable to non-funded income,” he further noted.

    Also speaking on UBA’s financial performance and position, the Group Chief Finance Officer(GCFO), Ugo Nwaghodoh said; “In a period of high interest rates, we achieved a relatively low 3.7% cost of funds. This operational efficiency reflects the benefit of our rich pool of stable savings and current account deposits. The net interest margin stabilized at 7%, even as yields on treasury assets dropped in the last quarter of 2017. Our core transaction banking offerings gained strong momentum, with income from these business lines growing by double digits.”

    “We remain committed to our responsible approach to balance sheet management, with focus on growing risk asset and broader balance sheet in a profitable and prudent manner. Amidst a subdued Nigerian credit market, we grew our loan portfolio by 10%, leveraging our robust liquidity and capitalization to support good businesses through this challenging economic cycle. We closed the year with a Basel II capital adequacy ratio of 19% and a liquidity ratio of 50%, well ahead of 15% and 30% regulatory requirement respectively. Our disciplined approach to lending and broader risk management continues to uphold our asset quality.”

    Apart from the strong financial performance in 2017, UBA Group proved its leadership on the continent as the Banker Magazine crowned the Group, “African Bank of the Year 2017”. To further demonstrate the group’s strength and dominance in the financial sector on the continent, four of UBA Group’s operations in Africa also led contenders in their respective countries to emerge the Best Bank of the Year 2017 in their respective markets. UBA Congo, UBA Tchad, UBA Gabon and UBA Senegal emerged the Best Bank of the Year in Congo, Tchad, Gabon and Senegal, reinforcing the strong franchise of the Group across its chosen markets in Africa.

    United Bank for Africa Plc is a leading financial services group in sub-Saharan Africa, with presence in 19 African countries, as well as the United Kingdom, the United States of America and France.

    From a single country operation founded in 1949 in Nigeria, Africa’s largest economy, UBA has emerged as a pan-African provider of banking and other financial services, to c.10 million customers globally, through one of the most diverse service channels in sub-Sahara Africa; 632 business offices, 1,750 ATMs, some 13,500 PoS, and a robust online and mobile banking platform.

    UBA was the first Nigerian bank to make an Initial Public Offering (IPO), following its listing on the NSE in1970. It was also the first Nigerian bank to issue Global Depository Receipts (GDRs). The shares of UBA are publicly traded on the Nigerian Stock Exchange (NSE) and the Bank has a well-diversified shareholder base, including foreign and local institutional investors as well as individual shareholders.