United Bank for Africa (UBA) Plc (the Group) has announced its audited half-year financial results ended June 30, 2017, indicating a profit before tax (PBT) of N57.5 billion, representing a significant growth of 65.5 percent over N34.8 billion recorded in the corresponding period of June 2016.
The results equally show that UBA shareholders’ funds grew by eight percent to N483.1 billion, just as it delivered an annualized 18.2 percent return on average equity (RoAE) and an interim dividend of N0.20 per share.
In the same vein, the group recorded an unprecedented profit after tax (PAT) of N42.3 billion, translating to a 56.2 percent growth over the N27.1 billion recorded in the half-year of 2016.
According to a statement from the pan-African financial services group, the recorded profitability reflects the earnings capacity of the group and its capability to progressively deliver superior returns to shareholders
UBA specifically grew its gross earnings for the period by 34.5 percent to N222.7 billion, as against N165.6 billion reported in June 2016.
“This impressive performance, which reflects the strong momentum of UBA’s business and its increasing share of customers’ wallet, was driven by the 44.3 per cent and 16.0 per cent growth in interest income and non-funded income respectively,” the statement said.
The group’s operating income stood at N161.8 billion, compared to N116.2 billion recorded in the corresponding period of 2016, representing a 39.2 percent growth.
While the group closed the half-year with total assets of N3.69 trillion, a growth of 5.3 percent, it prudently grew gross loans to N1.6 trillion, a four percent growth when compared to the group loan book as at December 31, 2016.
Commenting on the result, Kennedy Uzoka, the Group Managing Director/CEO, said the results demonstrated the strong momentum of the bank as it delivers continuous improvement across our businesses and key performance metrics.
“Our unwavering focus on customer service excellence is translating to strong operational and financial efficiency gains. We have achieved better pricing on assets and liabilities, leading to continued improvement in the net interest margin to 7.3 percent,” he said, adding that while leveraging its service-focused strategy and treasury management, the bank grew non-interest income by 17 percent year-on-year.
According to him, UBA has made considerable progress in its retail banking penetration, gaining market share in deposits, at a time when a sizeable percentage of households are challenged due to inflationary pressures on disposable income. The Bank grew its retail savings and current account deposits by 23% and 5% YTD respectively.
Ugo Nwaghodoh, the group CFO, said that the bank had “a strong start in the year, despite the protracted recession in Nigeria, our largest market. Our profit after tax of N42 billion translates to 18.2% return on average equity, broadly in line with our 2017FY guidance.”
He further said that the Bank’s African subsidiaries (ex-Nigeria) contributed 32 percent of the group’s earnings, leveraging on digital offerings to gain market share across the different markets.
“We maintain our discipline of banking only quality and profitable assets, a conservative stance which reflects on our asset quality. Notwithstanding consistent liquidity mop-up by the CBN, we maintained an average balance sheet liquidity ratio of 42%. Further reinforcing the Bank’s capacity is the strong BASEL II capital adequacy ratio of 20%, which underpins our ability to grow, as the macro risks decline, he said”
United Bank for Africa Plc is a leading pan-African financial services group, with presence in 19 African countries, as well as the United Kingdom, the United States of America and France.