Post Views: 409 • CEO Assures Of Bullish Year-End, Despite Nigeria’s Coming Elections The board of United Bank for Africa Plc, on Tuesday evening pres...
• CEO Assures Of Bullish Year-End, Despite Nigeria’s Coming Elections
The board of United Bank for Africa Plc, on Tuesday evening presented its unaudited financials for the nine-month ended September 30, 2018 to the Nigerian Stock Exchange (NSE), indicating that expenses grew faster than income, following which profit before and after tax barely managed to snail past the figure for the corresponding period of last year.
Gross earnings for the period stood at N374.829bn, up N40.924bn or 12.26% from N333.905bn in the prior third quarter figure; helped by the N268.937bn interest income, which climbed N30.845bn from N238.092bn, or 12.26%. Interest expenses rose from N85.795bn to N118.239bn, a drop by N32.444bn or 37.82%, leaving net interest income at N150.698bn, down from N152.297bn in.
Fees and commission income climbed to N69.278bn, up by N11.393bn or 19.68% from N57.885bn in the corresponding period of 2017; while expenses soared by N7.016bn or 62.59% to N11.226bn, from N11.21bn; as net fee and commission income stood at N51.052bn, up from N46.675bn.
Net trading and foreign exchange income dropped to N32.401bn from N34.475bn, representing a N2.074bn or 6.02% drop; just as other operating income increased by 22% to N4.213bn from N3.453bn. Total non-interest income therefore stood at N87.666bn from N84.603bn; as operating income grew marginally from N236.9bn to N238.364bn.
Net impairment loss on loans and receivables for the period dropped slightly from N12.909bn to N10.674bn; resulting in net operating income after impairment loss on loans and receivables of N227.69bn, as against the N223.991bn of prior nine months.
Employee benefit expenses rose to N53.254bn, from N51.296bn; depreciation and amortization rose to N8.61bn from N7.418bn; just as other operating expenses notched slightly to N87.221bn from N86.985bn. This resulted in total operating expenses of N149.085bn, up fromN145.699bn
Profit before tax was flat at N79.111bn, up from N78.325bn, as income tax charge stood at N17.413bn from N17.405bn; leaving a net profit of N61.698bn, compared with N60.92bn in the preceding nine months Earnings Per Share (EPS) therefore stood at N1.72, down from N1.74 in the preceding third quarter.
Total assets for the period rose to N4.507tr from N4.069tr, boosted by customer loans and advances of N1.595tr, down from N1.65tr, as at December 2017; investment in securities jumped to N1.696tr from N1.216tr. Total liabilities stood at N3.997tr from N3.54tr, helped by the N3.177tr customer deposits, which improved by N443.97bn, or 16.24% from N2.733tr. Shareholders’ funds for the period dropped to N488.803bn from N511.203bn, representing a decline of N22.4bn, or 4.38%.
A statement by the UBA Plc quoted, Kennedy Uzoka, the Group Managing Director/CEO, as saying a number of strategic imperatives were achieved “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 group’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 fulfill 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.
“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 N4.5tr. Notwithstanding the statutory-induced cost growth, our earnings proved resilient, as we recorded nine-month profit before tax of N79bn. Notwithstanding the macro-risk arising from upcoming elections in Nigeria, our single largest market, we are confident of finishing the year strong,” Uzoka stressed.
Also speaking on the performance, Group Chief Finance Officer, Ugo Nwaghodoh said despite the relative volatility in the period under review, 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 group remains on track to deliver its earnings target for the year.
He expressed commitment to the group’s “five-year plan of working down CIR to 50%, which we consider to be a normalised medium-term CIR. Overall, we closed the third quarter with a post-tax RoAE of 16% and the Group remains well capitalized and liquid, as reflected in the Group’s capital adequacy of 21% and Bank’s liquidity ratio of 53%.”