UBA posts record earnings of N375bn with N79bn in third quarter profit

The United Bank for Africa (UBA) set the tone for the latest round of big bank earnings with a dividend hike and profits and revenues in the third quarter.

The bank’s financial report, filed to the Nigerian Stock Exchange (NSE) on Tuesday, shows the bank’s net operating improved by 1.7 percent year-on-year to N227.7 billion, when compared to N224 billion achieved in the similar period of 2017.

The bank said it 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,” amidst inflationary pressures and uncertainties undermining the business environment in Nigeria and a few other countries in Africa, according to Group Managing Director/CEO Kennedy Uzoka.

According to the NSE filing, the bank’s operating expenses slightly increased by 2.3 percent to N149.1 billion, compared to N145 billion recorded in the same period of last year. Overall, the bank posted a Profit Before Tax of N79.1 billion and Profit After Tax of N61.7 billion, putting the bank’s annualized return on average equity at 16% and 20% at pre-tax and post-tax profit level respectively.

The third quarter’s results reflect steady progress toward achieving our goals and enhancing shareholder value, said the bank.

Financial report shows that the bank’s Total Assets increased by 10.8 percent to N4.51 trillion over the N4.07 trillion total asset recorded as at December 2017; while customer deposits grew 16.2 percent to N3.18trillion over N2.73 trillion as at December 2017.

The shareholders’ fund remained strong at N509.3 billion, even as the implementation of International Financial Reporting Standard (IFRS) 9, moderated the Group’s equity by 3.8 percent.

“Our franchise is increasingly renowned for financial solution and I am happy with the consistent growth in our businesses across the continent. We have grown balance sheet by 11% year-to-date to over N4.5 trillion. Notwithstanding the statutory-induced cost growth, our earnings proved resilient, as we recorded nine-month profit before tax of N79 billion. Notwithstanding the macro-risk arising from upcoming elections in Nigeria, our single largest market, we are confident of finishing the year strong,” Uzoka said.

Also speaking on UBA’s financial performance and position, the Group CFO, Ugo Nwaghodoh said: “We remain committed to our five-year plan of working down CIR to 50 percent, which we consider to be a normalised medium-term CIR. Overall, we closed the third quarter with a post-tax RoAE of 16 percent and the Group remains well capitalized and liquid, as reflected in the Group’s capital adequacy of 21 percent and Bank’s liquidity ratio of 53 percent.”