UBA Group Grows First Quarter Profit by 41% to N25.5bn
United Bank for Africa (UBA) Plc yesterday released its unaudited first quarter(Q1) results ended March 30, 2017, showing significant growth across major income lines. Leveraging on strong growth in both interest and non-interest income as well as increased efficiency, UBA recorded N25.5 billion in profit before tax (PBT) in 2017, compared to N18.1 billion achieved in Q1 of 2016. The Group also recorded a profit after tax (PAT) of N22.4 billion, showing 32 per cent growth compared to N17.0 billion achieved in the corresponding period of 2016. The group sustained its strong profitability recording an annualised 19.4 per cent Return on Average equity (RoAE).
Driven by an unprecedented 43 per cent year-on-year growth in interest income, UBA Group recorded a 38 per cent percent year-on-year growth in gross earnings to close at N101.2 billion in 2017, compared to N73.7 billion recorded in the corresponding period of the year 2016.
The Group Managing Director/ CEO of the United Bank for Africa, Mr. Kennedy Uzoka, expressed satisfaction with the bank’s impressive performance 2017, despite intensifying competition and a very challenging business environment.
“Our performance in the first quarter of the year strengthens our optimism on economic and business recovery in Nigeria and many of our markets across Africa. More importantly, this result is evidence of efficiency gains in our pricing, balance sheet management and operations,” Uzoka said.
“Driven by our balance sheet liquidity, we grew interest income by 43% to an unprecedented quarterly run-rate of N77 billion. Buoyed by improving foreign currency supply in Nigeria, remittance and trade services fees almost doubled and foreign currency trading income grew by 148 per cent year-on-year, as we leveraged our Customer First initiatives to gain market share in these offerings. More so, it is my pleasure to report that we made further progress in our consistent retail penetration, as reflected in the 12 per cent year-to-date growth in retail savings and current account deposits. Notwithstanding the tight interest rate environment, we recorded a 30bps reduction in cost of funds to 3.4 per cent, a positive result of our customer service-led approach to low cost deposit mobilisation. As at Q1, low cost savings and current accounts (CASA) represent 80 per cent of our deposit funding,” Uzoka explained.
While emphasising the increasing relevance of its African operations to its bottom line, Uzoka said: “Our businesses outside Nigeria continued to wax stronger, contributing 35 per cent of our earnings. We remained prudent in risk asset creation growing net loans by two per cent, as we have continued to monitor development in key sectors of the economy to take advantage of emerging bankable opportunities in due time. Albeit the structural challenges that exist in Africa, the opportunities and returns are immense and compelling. We will deepen our penetration across our chosen markets, as we diligently execute our strategies for consistent market share gain.”