UBA Shows Resilience, Records N375bn Earnings, N79bn Profit

United Bank for Africa Plc yesterday announced its unaudited results for the nine months ended September 30, 2018. The pan-African financial institution with presence in 20 African countries, recorded gross earnings of N374.8 billion, an 12.3 percent increase when compared to N333.9 billion recorded in the corresponding period of 2017.

Net operating income stood at N238.364 billion as against N236.9 billion, while net impairment charges fell from N12.909 billion to N10.674 billion in 2018.

Amidst inflationary pressures and uncertainties undermining the business environment in Nigeria and a few other countries in Africa, UBA’s operating expenses only increased by 2.3 percent to N149.1 billion, compared to N145 billion recorded in the same period of last year.

In all, the bank posted a profit before tax (PBT) of N79.1 billion, compared with N78.2 billion while profit after tax (PAT) improved from N60.9 billion from N61.6 billion.

The bank ended the period with a strong balance sheet, with total assets of N4.51 trillion up 10.8 per cent, from N4.07 trillion as at December 31, 2017.

Another strong indication of the growth of the bank and more so, acceptance of the franchise across Africa is the remarkable 16.2 per cent year-to-date growth in customer deposits, which grew to N3.18 trillion, compared to N2.73 trillion as at December 2017. Also, shareholders’ funds remained very strong at N509.3 billion, even as the implementation of International Financial Reporting Standard (IFRS) 9, moderated the group’s equity by 3.8 per cent year-to-date.

Commenting on the result, the Group Managing Director/CEO, UBA Plc, Kennedy Uzoka, said: “We achieved a number of strategic imperatives during the quarter and committed more investments in the future of the business - building a solid foundation for sustainable and superior return to our shareholders.”

Uzoka said that he is pleased that the bank’s virtual banking chatbot, Leo, which debuted on Facebook earlier in the year, was successfully launched on WhatsApp during the quarter.

“This new channel offering, which enables our customers to fulfil their banking transactions through simple chat commands, is another premier initiative in our suite. The early pay-offs are quite compelling – recent customer acquisitions and broader transaction volume growth are exciting leading indicators that reinforce our confidence in these novel channels,” he said.

Also speaking on the performance, the Group Chief Financial Officer, Ugo Nwaghodoh said that despite the relative volatility in the third quarter of 2018, especially in the face of U.S. interest rate hikes and concerns over global trade war, which has disrupted the interest and exchange rate environment in many African countries, the bank remains on track to deliver its earnings target for the year.

He said: “We remain committed to our five-year plan of working down CIR to 50 per cent, which we consider to be a normalised medium-term CIR. Overall, we closed the third quarter with a posttax RoAE of 16 per cent and the Group remains well capitalized and liquid, as reflected in the Group’s capital adequacy of 21 per cent and Bank’s liquidity ratio of 53 per cent.”