UBA Releases First-Half Financial Results, Gross Earnings Rise By 16%
United Bank for Africa Plc has announced 2018 half year audited financial results, showing strong growth across key performance metrics as well as a significant contribution from its African market.
The pan Africa financial institution delivered double digit growth in gross earnings despite experiencing decline in two core markets, Nigeria and Ghana.The bank recorded a 16 percent year-on-year rise in top-line to N258 billion, compared to N223 billion recorded in the corresponding period of 2017. This achievement, according to analysts, underscores the capacity of the Group to deliver strong performance through economic cycles, even in a challenging business environment.
According to the report filed to the Nigerian Stock Exchange on Wednesday, UBA, reported strong growth in operating income at N168.5 billion, compared to N161.8 billion in the first half of 2017, an increase of 4.1 percent. Nevertheless the inflation-induced cost pressure in the period, UBA finished the first half of the year strongly, with a Profit Before Tax of N58.1 billion. The Profit After Tax also improved to N43.8 billion, a 3.4 percent growth compared to N42.3 billion achieved in the corresponding period of 2017. The first half of the year profit, translated to pre-tax and post-tax return on average equity of 23% and 17% respectively.
UBA’s foreign operations continue to grow in significance, contributing 40% of the Group’s profit, which according to analysts attests to the benefit of UBA’s pan-African strategy and reinforces the Bank’s objective of achieving 50 percent earnings contribution from offshore subsidiaries.
In the first six months of the year, the Bank’s Total Assets grew 4.9% to N4.27 trillion and Customer Deposits rose by 6.1 per cent to N2.90 trillion, compared to N2.73 trillion as at December 2017. This growth transposition underlines UBA’s market share gain, as it increasingly wins customers through its re-engineered customer service and innovative digital offerings. The Group’s Shareholders’ Funds remained strong at N496.3 billion, even as implementation of IFRS 9 impacted the total equity of the bank and its peers.
In line with its culture of paying both interim and final cash dividend, the Board of Directors of UBA Plc declared an interim dividend of N0.20 per share for every ordinary share of N0.50 each held on the qualification date – Wednesday, September 05, 2018.
Commenting on the results, the Group Managing Director/CEO, United Bank for Africa Plc (UBA), Mr. Kennedy Uzoka said: “Our achievement in the first half the year reflects the recovery of our business model and strategies. Despite declining yields in two core markets, Nigeria and Ghana, we delivered double digit growth in gross earnings. Our achievement demonstrates the success of our digital banking initiatives and broader Customer-First strategies”
“We are integrating banking to our customers’ lifestyle, simplifying processes for routine transactions and driving financial addition by making banking services accessible and affordable. We are creating advancement for wealth creation and economic progress, as we empower our customers through innovative platforms and solutions that support their personal and business growth. Our commitment to delivering excellent service is paying-off, as we increasingly win a bigger share of customers’ wallet across our chosen markets. We won the highly coveted “Africa’s Best Digital Bank” Award by Euromoney, demonstrating our pioneering initiatives are being recognised with Leo, our digital banker having been name checked by Mark Zuckerberg ” Uzoka said.
“Our enhanced asset-liability management strategies improved asset yield and grew interest income by 21% despite prevailing yield environment. Our re-engineered sales structure provided the impulse for renewed retail deposit growth. I am particularly pleased by the 24% year-to-date growth in retail savings and current account deposits, supporting the increasing penetration of our digital offerings and the Group’s overarching goal of democratizing banking across Africa. We improved net interest margin to 7.4%in line with our 2018 target, notwithstanding strong competition for wholesale deposits and the impact of rising global interest rates on our foreign currency funding,” he concluded.
UBA is one of Africa’s leading banks with operations in 20 African countries. It also has presence in the global financial centres; London, New York and Paris. UBA provides banking services to more than 15 million customers over the entire planet, through different channels.