How UBA UK will serve trade, capital needs of African customers

Africa’s financial supermarket, the UBA Group, last week formally birthed its new UBA franchise, UBA UK, at an upscale ceremony which held at the prestigious Shard in the city of London

This is coming barely three weeks after the UBA Group launched its operations in Mali, building on its promise of being the bank of choice for businesses across the African continent.

Last week, all attention shifted to the global financial city of London, which hosted a high level gathering of business and public sector leaders, on Thursday February 28, 2019, as the new UBA franchise, UBA UK, was formally birthed in the United Kingdom amidst high expectations.

UBA UK was formerly introduced to business leaders across Europe and Africa with a commitment from the UBA Group of its readiness to galvanise trade and commerce between Europe and Africa.

The formal launch is sequel to the authorization of the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) for UBA UK Limited to carry out full scale wholesale banking across the United Kingdom.

With this launch, UBA Group further consolidates its unique positioning as the first and only sub-Saharan African financial institution with banking operations in both the United Kingdom and the United States, thus reinforcing its strong franchise as Africa’s Global Bank, facilitating trade and capital flows between Africa and the world.

The launch did not come to many as a surprise as the bank has always made known it intentions to facilitate inter-andintra-African trade and also be the pivot for the inflow of investment capital

Africa presents a huge opportunity to providers of financial services and trade contributes to economic growth and development through different channels.

Exports allow firms to access larger markets and to innovate through greater competition, leading to higher productivity and growth. Imports expand the range of goods and services that consumers can access. In addition, imports allow firms to access machinery and intermediate goods for production purposes.

Africa’s GDP grew, on average, at 4% per annum between 2000 and 2012, declined to an average of 3.5% between 2013 and 2015 but shrunk to a decade-long low of 1.7% in 2016 driven by weak global economic conditions, still-low (even if rising) oil and commodity prices and adverse weather conditions (drought).

In the past decade, trade has been a major contributor to Africa’s economic growth, and expanded at an average annual rate of about 8%. Despite this growth, importers and exporters are faced with the key challenge of financing cross-border trade where there is a significant lag between payments and the delivery of goods and services.

This requirement for trade finance to intermediate between the exporters and importers is estimated at 360 to 400 billion, based on the comprehensive 2014 ‘Trade Finance in Africa’ survey by AfDB. This is the most comprehensive survey to-date on trade finance in Africa.

Speaking at the event, the Group Chairman, Mr. Tony Elumelu said: “The enhancement of our business in the United Kingdom is very timely and mutually beneficial for African and European corporates as well as respective governments.

“With the British and other European governments seeking new and improved measures to grow trade relations with Africa, we are enthusiastic on our positioning and capabilities in supporting corporates and government institutions to fulfil these lofty aspirations, which we believe are pertinent for the sustainable growth of both continents.”

Elumelu said: “Before UBA got here, and with the kind of licence we had before, it meant that if a business in any of the Anglophone countries is transacting with a partner, in England, they have to deal with another bank. But today, with our wholesale licence, that is a time of the past.”

He said UBA is inter-continenting businesses in Africa, not just UK, but across the world because it has a big franchise in the US. “It means that our customers anywhere in Africa don’t need to talk to a third party. What we have done is to prove what we call a UBA one stop shop, that whether you are in Ghana, whether you are in Nairobi, by talking to UBA in either Nairobi or Ghana, you are transacting without any third party, because we are a regulated entity here, and indeed, a first class financial institutions.”

“When we say we are a true pan African bank, it means we bring our expansive reach and our expertise across the world to the doorsteps of our customers. We are taking away that boundary, that barrier that used to exist for Africans to make their business easy.

“So truly, we are letting them know that it is not just by saying it but by making it happen. So, this is one of the right steps that show that UBA is very unique, and it is the only bank with Nigerian origin that operates in 20 African countries,” he added.

Describing the potentials of the new license, Elumelu said: “this licence that we have is like a bird that has been in a cage been disposed. You can imagine what will happen in terms of foreign direct investment and inflows.”

Elumelu said he was extremely pleased as UBA is living up to its mantra of being Africa’s global bank and positioning itself to support investors in key financial centres across the world.

Also speaking at the event, The Group Managing Director/CEO, Mr. Kennedy Uzoka, noted that, “UBA Group is the most efficient gateway for European corporates and institutions to access Africa, given the bank’s expansive network across most impact markets on the continent and its deep knowledge of the business terrains in Africa.”

According to him, “Simultaneously, we are serving the trade and capital needs of our African customers, who are seeking exposure to the European markets. With the upgrade of UBA UK Limited, we are excited to deepen our support to existing customers whilst also providing the leverage for new customers to effectively fulfil their cross-border transactions through UBA Group’s network.”

On his part, the CEO, UBA UK, Mr. Patrick Gutmann, said; “We are now on a stronger footing, as the authorization of the PRA and FCA for an enhanced business model affords us the opportunity to swell our capital and balance sheet as well as the broader UBA Group’s network across Africa.

“We welcome our existing and new customers to this new world of borderless opportunities, as we creatively serve our customers in meeting their international transaction needs.”